April 21, 1980 ALBERTA HANSARD 457 LEGISLATIVE ASSEMBLY OF ALBERTA Title: Monday, April 21, 1980 2:30 p.m. [The House met at 2:30 p.m.] PRAYERS [Mr. Deputy Speaker in the Chair] head: PRESENTING REPORTS BY STANDING AND SELECT COMMITTEES MR. ZAOZIRNY: Mr.

Speaker, as chairman of the Standing Committee on Private Bills, I hereby report that Standing Order 77, concerning publications of notice of application in the Alberta Gazette and newspapers, has been complied with in respect of the following petitions: the petition of the city of Edmonton for The Edmonton Research and Development Park Authority Act; the peti­ tion of the Prairie Bible Institute for The Prairie Bible Institute Amendment Act, 1980. Standing Order 77 has not been complied with with respect to the following petitions: the petition of Roger Motut, Herve H.

Durocher, Francis McMahon, Lucien Maynard, Joseph Moreau, Jean-Paul Bugeaud, and Jules van Brabant for The La Foundation de l'Association canadienne-francaise de l'Alberta Act; the petition of the Alberta Wheat Pool for The Alberta Wheat Pool Amendment Act, 1980; the petition of Edna Barbara Dial for The Keith Dial Adoption Termination Act; the peti­ tion of R.W. Chapman, F.G. Stewart, L.H. LeRiche, R.R. Francis, E.B. McKitrick, H. McEwan, and D.

McPherson for The Alberta Foundation Act; the petition of Gladys Marshall for The Warren Dean Boyd Adoption Act; the petition of Sherm Ewing for The Stockmen's Memorial Foundation Act. I beg leave to move that the said petitions be referred to the Private Bills Committee for consideration pursuant to Standing Order 81(2). head: INTRODUCTION OF BILLS Bill Pr. 2 The Edmonton Research and Development Park Authority Act MR. PAHL: Mr. Speaker, I request leave to introduce a Bill, being The Edmonton Research and Development Park Authority Act.

The purpose of this Bill is to create a body corporate named the Edmonton Research and Development Au­ thority, which will then have the ability to establish, manage, and operate research and development parks in the city of Edmonton. Mr. Speaker, the import of this legislation is to firmly establish the framework for a home for a rapidly developing research and development or brain industry here in Alberta. [Leave granted; Bill Pr. 2 read a first time] INTRODUCTION OF SPECIAL GUESTS MR. KING: Mr.

Speaker, on behalf of my colleague the Member for Edmonton Avonmore, I would like to intro­ duce to you, and through you to the members of the Assembly, 40 grade 9 students from Donnan school in the constituency of Edmonton Avonmore. They are seated in the public gallery, accompanied by teachers. I would ask them to rise and receive the welcome of the members of the Assembly. MR. COOK: Mr. Speaker, I hope the Assembly will bear with me; I seem to have lost my voice over the weekend. I would like to introduce to you and to the Assembly, Mr. Speaker, 50 grade 6 students from St.

Matthews elementary school in my constituency. I count among them several supporters in my nomination and election campaigns. I am very pleased to have this group here to watch the Assembly in action, to watch democracy as we're dealing with the pressing issues of the day. It's with a great feeling of pleasure that I would ask them to rise and receive the warm welcome of the Assembly. MR. WEISS: Mr.

Speaker, on behalf of the MLA for Edmonton Meadowlark, it is indeed a pleasure to intro­ duce to you, and through you to the members of the Assembly, 15 students from the constituency of Edmon­ ton Meadowlark who attend the grade 5 and 6 classes at Lynnwood elementary school. They're accompanied by their teacher, Mrs. McKie, and are seated in the members gallery. I would ask that they stand and receive the cordial welcome of this Assembly. MR. L. CLARK: Mr. Speaker, it gives me a great deal of pleasure today to introduce to you, and through you to the members of this Assembly, 10 grade 12 students from Delia.

They are accompanied by Mr. Houghton and Duane Limpert. I would ask them to rise and receive the welcome of the House. They're seated in the public gallery. head: MINISTERIAL STATEMENTS Department of Hospitals and Medical Care MR. RUSSELL: Mr. Speaker, at a news conference at 1 p.m. today, I announced that since the commencement of a strike by members of the United Nurses of Alberta, the government of Alberta has been very carefully monitor­ ing the conditions in the health care institutions through­ out Alberta.

This morning, reports indicated to me that there were stresses and strains developing in the system to the extent where cabinet felt that the emergency powers of the Labour Act should be invoked. We believed that the health and lives of Albertans may be jeopardized due to any breakdowns of the health care system in the province. Inasmuch as our responsibilities relate to the health and lives of Albertans we therefore felt, Mr. Speaker, that it was necessary to get the system functioning again as quickly as possible. We were not prepared to risk the lives of Albertans by a prolonged work stoppage.

The cabinet has therefore concluded that an emergency exists and, pursuant to the provisions of The Alberta Labour Act, has declared that on or after 6 p.m. this evening, April 21, 1980, all further actions in the dispute

458 ALBERTA HANSARD April 21, 1980 are to be replaced by these emergency procedures. The Minister of Labour has recommended and the cabinet has authorized Mr. Justice W.R. Brennan of the Court of Queen's Bench of Alberta to be a public emergency tribunal and to make a binding arbitration award. head: ORAL QUESTION PERIOD Nurses' Strike DR. BUCK: Mr. Speaker, to the hon. Minister of La­ bour.

Section 163(2) of the Labour Act says "Before an order is made under . . . , the Minister may give the parties to the dispute . . . ." Can the minister indicate if he did meet with the Alberta Hospital Association and the UNA before the emergency decision was made? MR. YOUNG: Mr. Speaker, to the hon. Member for Clover Bar. I indicated last week in the House that I had indeed had the occasion to meet with both parties through one evening and one night, until after 4 a.m., to examine and understand all the items in dispute.

Subse­ quently, just before the dateline for the strike — because of the very nature of this particular dispute, the fact that it did involve health services which could impact upon the lives of people — as I indicated, I did think it incumbent to call on the presidents of both associations and invite them to my office with whichever other officers they wished to bring. Both presidents came. So, Mr.

Speaker, I have had occasions to review the nature of the dispute, the items in dispute, the possibility of assisting in any further way, not only with the negotiating committee but also the very highest elected officer of each of the parties responsible in this dispute. DR. BUCK: Mr. Speaker, to the hon. Minister of Hospi­ tals and Medical Care. Can the minister indicate when the tribunal will commence its work, and when it must report to the minister? MR. RUSSELL: I should refer those matters to my colleague the Minister of Labour. MR. YOUNG: Mr.

Speaker, it is anticipated that the tribunal will commence its work at the very earliest date. The completion date indicated in the ministerial order is May 12. We hope that the tribunal could complete its work within that time frame, because in my view it is important that this matter be drawn to a definitive con­ clusion at the earliest date. DR. BUCK: Mr. Speaker, to the hon. Minister of Hospi­ tals and Medical Care. Can the minister indicate what consideration was given — the physical problems in­ volved in getting the nurses to go back to work at 6 o'clock tonight?

Can the minister indicate if the physical problems involved in getting people to back to work on such short notice were given consideration? MR. RUSSELL: Yes, a great deal of consideration was given to that matter, Mr. Speaker. We felt that an emergency did exist. We felt that four hours' notice to the hospitals and to the United Nurses was probably the minimum time that was reasonable to get the involved members back to work. We recognized, therefore, as a result of our meeting time this morning and our discus­ sions, that it would be highly improbable that we could get them back for the 3 o'clock shift change.

So we took the next most reasonable hour that we thought was achievable; that is, 6 p.m. DR. BUCK: Mr. Speaker, to the hon. Minister of Hospi­ tals and Medical Care. Have the minister and his col­ leagues given consideration to waiving the financial guidelines as they apply to Alberta Hospital Association financing, in light of the fact that an arbitration ruling will have to be brought down? Have those guidelines been reconsidered, in light of the fact that the arbitration awards may be higher than the guidelines? MR. RUSSELL: Well, Mr.

Speaker, I think it's implicit in the order that was passed that the order is binding on all parties; therefore the necessary funding would follow the tribunal's decision. The guidelines would still have to be recognized as guidance for the Alberta Hospital Asso­ ciation with respect to continuing negotiations that are coming up, which they're involved in with other labor groups in the health care system. But insofar as the dispute with the United Nurses of Alberta, I think it's implicit in our action that the award is binding on the government as well as the AHA. DR. BUCK: Mr. Speaker, to the hon.

Minister of Hospi­ tals and Medical Care. Can the minister indicate what studies his department has done to evaluate the relation­ ship between the worsening shortage of nurses and the salaries? MR. RUSSELL: I'm not quite sure of the thrust of the hon. member's question. I indicated that we do have an ongoing interdepartmental committee, which includes my own department, that keeps statistical track of the num­ ber of nurses in the profession registered in Alberta and the jobs that are available.

From time to time we also receive reports from the administration of various hospi­ tals and schools of nursing throughout the province. We have been concerned because of the declining number of applications for enrolment in the schools of nursing dur­ ing the last two years, and want to take steps to try to improve that. We have had preliminary discussions with the Alberta Association of Registered Nurses on that very matter. DR. BUCK: Mr. Speaker, a supplementary question.

Basically I was asking: in his studies, has the minister come to any conclusion: was it a combination of salaries and working conditions, or was it just salaries, Mr. Minister? MR. RUSSELL: Mr. Speaker, I think salaries are a very important part of it. We're confident that the tribunal will come down with a fair and binding decision on that. But I think it goes beyond that. The AARN has been very explicit in its concerns about the educational opportuni­ ties, the career achievements, and the status of the profes­ sion, that they feel they can work with in co-operation with government.

We're prepared to do that when we get the current matter of salaries and compensation behind us. DR. BUCK: Mr. Speaker, to the Minister of Advanced Education and Manpower. Can the minister indicate what changes in the government's or the department's philosophy have come about recently to look at the

April 21, 1980 ALBERTA HANSARD 459 problem of the shortage of nurses? Can the minister indicate if the programs are going to be beefed up to get more nurses involved in programs? MR. HORSMAN: Mr. Speaker, the hon. members are aware that last year a new program approval was put in place by the department with respect to a post-basic baccalaureate degree program at the University of Leth- bridge. I am confident that will go into effect this fall. I've had discussions with the presidents of the colleges as recently as this morning with respect to a review of the nursing programs in the public colleges system.

As hon. members are probably aware, Grande Prairie college is examining very carefully whether it will be putting a basic nursing program into place. I might also say, in anticipation of a further question from the hon. Member for Clover Bar, that with respect to expanding the program at the University of Alberta, while it is not directed to any specific professional faculty, additional funds have been made available in this year's budget for the University of Alberta.

Of course it will be the decision of the board of governors at that institution whether the additional funds requested last year for the post-basic baccalaureate program at the university will be expanded. As part of the overall expansion of profession­ al faculty funding, a special recognition has been made of the concerns expressed to the government by the board of governors of the University of Alberta. DR. BUCK: Mr. Speaker, a further supplementary ques­ tion to the Minister of Labour. This returns to emergency powers,

Section 163 of the Act. Can the minister indicate how the situation has changed between Thursday, when he met with representatives of the UNA, and today, to invoke the emergency

section of the Act? What has changed in that short period of time? MR. YOUNG: Mr. Speaker, that question has been re­ sponded to by the hon. Minister of Hospitals and Medi­ cal Care. I would again refer the same to him, if he cares to respond to it once more. MR. RUSSELL: Mr. Speaker, because of the nature of the services involved, I think hon. members appreciate that if a pending work stoppage in the system is possible, hospitals must take certain steps to prepare for that work stoppage. That winding down went into effect about a week before the possible strike deadline that had been discussed.

When it became apparent that a work stoppage was very real, perhaps within 48 hours, we set up a very comprehensive monitoring system involving all hospitals throughout the province that were either affected by the shutdown or that were still functioning because they were outside the terms of the dispute. We got ongoing reports on the situation. I think, as hon. members can appreciate, at first the system coped very well.

But as more and more seriously ill people were admitted to hospitals, and nurses still at work and other support staff were having to work longer and longer hours under increasing stress, the advice we were getting changed during the latter part of Sunday and early this morning: on the best belief of the professionals involved, they did not believe they could cope very much longer without endangering health and lives of Albertans. DR. BUCK: Mr. Speaker, my final supplementary ques­ tion to the minister.

Can the minister indicate what contingency plan for our hospitals he or members of the department have in place if the nurses resign en masse? MR. RUSSELL: Again, Mr. Speaker, I hesitate to an­ swer that because it is a hypothetical question. DR. BUCK: Mr. Speaker, I asked the hon. minister what contingency plan, what emergency plans, the minister has if that eventuality comes about. That's more than hypo­ thetical. I'm asking: what does the minister have in place? [interjections] MR. RUSSELL: Mr. Speaker, that's still the same ques­ tion.

It's one I've dealt with in discussions with individual nurses who have telephoned the office over the weekend. I've indicated to them that there are certain things a government can do. It can provide funding, pass laws, and other things of that kind. We can't affect the career decisions of individual nurses. It was pointed out to the nurses I discussed this matter with that if they feel so strongly that they must resign, I don't believe the gov­ ernment can stop them. But I must say, in conclusion, that I was encouraged in my discussions with a number of nurses over the week­ end.

I believe we're now trying to resolve a problem with a very professional group which has the needs of its patients in mind, and which will respect the laws of Alberta. DR. BUCK: Mr. Speaker, I'd like to pass a button over to the hon. minister, because I think nurses are worth it. Metis Development DR. BUCK: Mr. Speaker, my question is to the minister responsible for Metis development. Can the minister indi­ cate the written terms of reference for the joint committee established to review The Metis Betterment Act? MR. BOGLE: Mr.

Speaker, a ministerial order was passed on March 14, I believe, setting out the terms of reference for such a review and naming six individuals for the review. Since then the president of the Federation of Metis Settlements has advised me that two of the items which had been dealt with during our meeting on March 14 were still not to the satisfaction of the federation, and he requested further discussions. That request is being met. DR. BUCK: Mr. Speaker, can the minister indicate who will be responsible to establish the committee's terms of reference? Will that be the minister's responsibility?

Have those terms of reference been established? MR. BOGLE: Yes, Mr. Speaker. I believe a copy of the ministerial order is in the Legislature Library, if the hon. member doesn't have one. DR. BUCK: Mr. Speaker, can the minister indicate if funds have been allocated for the committee's work? MR. BOGLE: Mr. Speaker, funds were committed on March 14, when the committee was established. DR. BUCK: Mr. Speaker, on a point of clarification. Did the minister indicate if the committee has had meetings?

460 ALBERTA HANSARD April 21, 1980 MR. BOGLE: Mr. Speaker, on March 14 when the committee was struck, the first informal meeting of the committee was held to discuss a secretary, research work, and other such items. Following that meeting, the presi­ dent of the Federation of Metis Settlements contacted me. It's my understanding that no further meetings have taken place by the committee members — until those matters are clarified. DR. BUCK: Mr. Speaker, a supplementary. Can the minister indicate if the recommendation of the Ombuds­ man that an independent chairman be established was followed through? MR.

BOGLE: No, Mr. Speaker. DR. BUCK: Can the minister indicate why this was not followed? MR. BOGLE: Mr. Speaker, the Ombudsman did make a number of recommendations, I believe nine in total. One of those recommendations was that there should be a five-member committee, I believe, chaired by an inde­ pendent chairman acceptable to both sides. During our discussions with the Federation of Metis Settlements a number of alternatives were looked at; that was one.

A proposal was put forward by the government that in fact there be co-chairmen of the committee: one person ac­ ceptable to the federation, either the president of that organization or his designate; and an MLA from this Assembly. On that basis the ministerial order was signed. DR. BUCK: Mr. Speaker, a further supplementary to the minister. One of the recommendations was that more Metis people be established in the development branch. Can the minister indicate if this practice has been followed? MR. BOGLE: Mr.

Speaker, the opportunity to employ Metis people from the settlements has been provided for some period of time. We are examining ways now that the branch might be more attractive to Metis people. One, of course, is if the branch is decentralized and located in two or more sub-branches closer to the settle­ ments themselves. Those concepts are under way. Some discussions have been held on the same. DR. BUCK: Mr. Speaker, to the minister. The minister indicated that these opportunities are available. Have any people been placed relatively recently? MR. BOGLE: I'd have to take that question as notice, Mr. Speaker.

I don't recall following the questions in this area last year when I indicated that if all the employees in the Metis betterment branch are included, including those in the hot-lunch program, well in excess of half the total number are from the settlements and the isolated com­ munities in the north. But I'll take as notice the question of most recent opportunities for employment. Long Distance Telephone Rates MRS. EMBURY: Mr. Deputy Speaker, my question is to the Associate Minister of Telephones.

Could the minister advise the Assembly with respect to reports that the Canadian radio and television commission has sub­ poenaed the president of the Trans-Canada Telephone System for confidential information that belongs to Al­ berta Government Telephones? DR. WEBBER: Mr. Speaker, the Canadian Radio- television and Telecommunications Commission is having a hearing related to the Canada-wide long distance rates of Bell Canada and B.C. Tel.

An order was issued to those telephone companies to provide information which was proprietary to Alberta Government Telephones and the Trans-Canada Telephone System with regard to AGT's long distance rates between Alberta and British Columbia, Alberta and Saskatchewan, and within Alber­ ta itself. MRS. EMBURY: A supplementary question, Mr. Dep­ uty Speaker. Could the minister please indicate why Alberta Government Telephones doesn't want to release this information? DR. WEBBER: Mr. Speaker, Alberta Government Tele­ phones is regulated by the Public Utilities Board in Alberta.

The information that was requested by the CRTC is confidential and proprietary to AGT and the Trans-Canada Telephone System. AGT felt, and as a government we feel, that this information should not be in the hands of the Trans-Canada Telephone System. We felt that the order that was given to Bell and B.C. Tel, plus the CRTC subpoena that the hon. member men­ tioned, is an attempt by the CRTC to make the first step towards the regulation of long-distance telephone rates in the country.

I might say that Alberta Government Telephones has taken steps to look at the legal possibilities of having this information not become public. I've sent a telegram to the federal Minister of Communications requesting that he take whatever steps he can to quash the order and keep the information confidential. I might add that there are other provinces — Nova Scotia, New Brunswick, Manitoba, Saskatchewan — that have taken similar action. Trades Training DR. PAPROSKI: Mr. Speaker, a question to the Minis­ ter of Advanced Education and Manpower.

I wonder if the minister would indicate to the House whether a site has been selected for the proposed new Edmonton trades training facility in Edmonton, which is so important for an expanding economy in our province. MR. HORSMAN: Mr. Speaker, no, at this time a site has not been chosen. In fact, I announced just last week that a committee had finally been established — at least the director of the new school has been appointed, and he has been given the mandate to plan and develop the new institute over the next period of months.

At this stage no firm decision on site has been made, except that the position of the government is that any new facility will not be located within the city of Edmonton. DR. PAPROSKI: A supplementary, Mr. Speaker. I wonder if the minister would then indicate how many students he anticipates will be accommodated by such a facility. Will that facility have characteristics similar to NAIT and SAIT in this province? MR. HORSMAN: Mr. Speaker, it is anticipated that the institution will serve approximately 3,000 full-time stu­

April 21, 1980 ALBERTA HANSARD 461 dents. That may translate into many more actual stu­ dents, with regard to the nature of the apprenticeship training program. It is anticipated that while the pro­ gramming may be similar to NAIT and SAIT, it is unlike­ ly to be identical. It may very well be that some of the programming now offered at those institutions, in partic­ ular NAIT, may be transferred to the new institution when it is operational. I would point out, Mr.

Speaker, that both SAIT and NAIT will be included in the discussions, and program­ ming will be designed to complement and supplement the programming presently offered by our technical, voca­ tional, and trades training. DR. PAPROSKI: A final supplementary, Mr. Speaker. I wonder if the minister would clarify the statement that the Edmonton trades training facility will not be in Edmonton. Is he suggesting to the House that the facility will be on the periphery, just outside Edmonton, or where? DR. BUCK: Fort Saskatchewan. MR. HORSMAN: Mr.

Speaker, I admire the persistence of the questioner, but I wish to indicate that no decision has been made. The location will be reviewed very care­ fully by the departmental committee headed by the new director. At this stage I'm saying to the House that it will be located in the Edmonton region, however that may be defined, and not in the city of Edmonton. MRS. FYFE: A supplementary, Mr. Speaker. Would the minister advise the House if he can anticipate how long it will be before we know the location of this facility? MR. HORSMAN: Mr.

Speaker, I have indicated to the committee that I would be very anxious to have the decision made so that detailed planning can be concluded within the current year, and that perhaps a start with regard to the project be undertaken so that it will be ready for occupancy no later than 1984. Therefore, I think it's fair to say that a decision should be arrived at within months, hopefully by the end of this year. ORDERS OF THE DAY head: GOVERNMENT BILLS AND ORDERS (Second Reading) Bill 13 The Municipal Taxation Amendment Act, 1980 MR. MOORE: Mr.

Speaker, this afternoon I intend to outline in some detail the proposals for changes in as­ sessment and taxation in rural Alberta. First of all, I would want Members of the Legislative Assembly to understand that these are the most extensive changes in municipal assessment and taxation in rural Alberta that have been proposed in about 20 years. I want to indicate initially the process we went through in order to develop the changes which are before the Legislature now.

During the course of the last year in particular, but even before that, extensive discussions have been held with the Association of MDs and Coun­ ties, with such organizations as Unifarm, the Western Stock Growers' Association, a good number of individual acreage owners' associations, and indeed individual coun­ cils and groups across the province. In addition, of course, Members of the Legislative Assembly had a very extensive debate on this issue last fall. Mr.

Speaker, in November 1979, in a speech to the annual meeting of the Association of MDs and Counties, I outlined in principle some changes which I proposed to make at that time. Since November we've had further extensive meetings with the association of MDs and counties, finalizing, I suppose, those meetings in April of this year, at a spring meeting of that association in Calgary. Mr.

Speaker, before getting into a description of the proposed changes, I want to recognize the work that went into these proposals with respect to the Provincial- Municipal Finance Council, formed some years ago and made up not only of staff of the Department of Munici­ pal Affairs but rural and urban councillors from across this province, as well as the Minister of Municipal Affairs and a number of other colleagues in the Legislative Assembly.

Finally, I would be remiss if I didn't recognize the very extensive time and work that went into these proposals by the staff of the Department of Municipal Affairs, in particular by Mr. Grover, the assistant deputy minister of assessment services. Mr. Speaker, very clearly my purpose today is to ask for the support of the Legislative Assembly with respect to these changes. First of all, I want indicate to members that I will make all my remarks on Bill 13, and that Bill 9 is a companion piece of legislation which deals specifical­ ly with changes with respect to electric power and pipe­ line assessment.

I should say as well that Bill 13 does not include all the changes being made, because a good number of them are made by way of ministerial regula­ tion, by order in council, or by changes in assessment manuals, which are adopted by ministerial regulation. So for that purpose I outline in detail to members of the Assembly and to others across the province the changes that will occur as a result of the amendments to Bill 13 before you. That forms a document entitled Proposed Changes in Assessment and Taxation, with a covering memo from me dated April 5. In addition, Mr.

Speaker, if they haven't done so already, the pages will shortly be passing around a pamphlet entitled Proposed Changes in the Levels of Assessment Values in Rural Municipalities, which is really very similar to the March 5 document I referred to. In addition to that, a single-page graph outlines the increase in values that will occur with respect to some nine different classes of property under these proposals. Mr. Speaker, there have been a couple of changes with respect to the proposals as they existed on March 5 and as they existed when this particular brochure was printed.

Both those changes flowed from the meeting of the Association of MDs and Counties earlier this month in Calgary, and take the form of two changes in figures: one with respect to farmland where, after listening to their debate and seeing the resolutions passed at the spring meeting of the Association of MDs and Counties, we reconsidered the values for farmland and have now re­ adjusted those to $240 per acre, as opposed to the $260 actually outlined in the brochure. The only other single substantive change, Mr.

Speaker, is in the oil well lease site on Crown land, from a proposal of $650 per well to $1000 per well. Before outlining the changes in some detail and the reason for the changes, I might say that this particular

462 ALBERTA HANSARD April 21, 1980 brochure was printed before those changes were finalized. The results of having some of my colleagues and others look at this brochure have led me to ask that another one be printed very shortly to replace this particular pamph­ let. That will be done after this debate today, so I would ask members to hold their requests for copies of this till such time — perhaps a week or 10 days — that I might have additional copies available that have the appropriate alterations. Now, Mr.

Speaker, if I can go to a description of the changes that are being proposed: they are most aptly described on the page of the brochure which outlines levels of value for rural municipalities, the type of proper­ ty, the present situation with regard to the assessment of that property, and what is being proposed by way of this legislation. I start first with farmland, Mr. Speaker. You will see by looking at the brochure that the present maximum of $40 per acre is being proposed to be changed to $240 per acre. The maximum values of farmland were set in the early 1960s.

I'm not at liberty to suppose or know exactly why they were set at $40 per acre, but I presume the discussions of that day centred on many of the concerns we had in developing a new maximum value for farm­ land; that is, an economic value as opposed to a market value and, in addition, a relationship to other properties assessed in a rural municipality that was deemed fair and appropriate. I can, however, elaborate on how we arrived at the $240 per acre figure. First of all I want to emphasize that that is the maximum. That is the amount the best quarter

section of farmland in this province would be assessed at. Generally speaking that's a very black soil, level quarter

section that has no restraints in terms of farming or production that might exist on much of our land. Only a few quarter sections in the entire province meet this crite­ rion. Every other quarter

section is assessed at somewhat below that. When one gets into the drier areas of the province, such as the Special Areas and so on, you will find assessment levels far far below what exists at the upper maximum. In addition to that, I should say that we should use as a rule of thumb in terms of the increase in farmland assessment on your own or your constituent's farm, an increase of six times the existing assessment. In other words, if you have a parcel of land that is assessed today at $15 per acre, under this proposal there will be an increase of six times.

There are one or two variations in that sixfold increase that I'd like to discuss briefly. One is in the Peace River district of Alberta, where for a number of years we've had a lower assessment, by some 20 per cent, on farmland than existed elsewhere. It's outlined in the brochure: $32 per acre. That assessment, Mr. Speaker, was put into place in the Peace River district many years ago because of a concern there with respect to access to markets and the difficulties in a newer developing homestead region. It's my view that those same difficulties do not exist today. In addition to that, Mr.

Speaker, the new method of assessing farmland will take into consideration, at least to some extent, the distance from market when we're assessing farmland and other constraints on gaining a livelihood from agriculture that might exist to a larger extent than was the case previously. In addition to that, I should say that there will be a change with respect to irrigated land, where levels of value up to $55 per acre were in place previously.

We've adjusted those levels to actually provide a situation where there will be a smaller increase on irrigated land than might be the case on other land, by recognizing after a very thorough review of production on irrigated lands, that irrigated lands, which are mostly brown soils, are in fact able to produce with the irrigation a crop equivalent to that produced on black soils. Through the assessment process; it would be our intention to assess irrigated lands on a black soil basis. So, in fact, under our existing system those $55 levels would have become $40 levels maximum.

Under the new proposed system they will be $240 maximum, which is something less than a sixfold increase. Very briefly, Mr. Speaker, if I might get to the manner of how we arrived at the figure of $240 per acre as a maximum for farmland, it was very definitely a consider­ ation that involved this business of farming when it comes to the costs that exist today and over the last perhaps five years. It recognized the agricultural industry is one which cannot pass its costs through.

It recognized that market values of farmland vary considerably across the province and that it was, in my judgment, a much fairer situation to set the assessment of farmland in Alberta on a productive value as opposed to a market value. In establishing that productive value, we consid­ ered the factors that exist with regard to input costs and net income from farming over the course of a five-year period, from 1975 to '79.

During the course of that consideration, we looked at loans made by the Alberta Agricultural Development Corporation and by the Farm Credit Corporation in Alberta, recognizing that both those institutions required farmers who were borrowing to purchase land to put together figures of cost and return that would show that there was an ability to pay for the land, get some return for the labor, and pay all the input costs. In addition to that, Mr.

Speaker, we looked at the extensive studies done over the last few years by the Alberta Department of Agriculture called cost and pro­ duction returns for various classifications of agriculture. Those studies were done with respect to beef cattle, cow-calf operations, feeder operations, hog operations, extensive grain farming, and so on.

While it may be a little subjective to come up with a single figure, after all that discussion and that study had occurred we felt it was reasonable to assume that $240 per acre should be a maximum productive value, that being 65 per cent of what now turns out to be some $370 per acre as a maximum productive value for the very best farmland in Alberta. If I could go from there to the question of farm buildings, Mr. Speaker, farm buildings in this province, those being all buildings on the farm except the farm residence, have for many years been exempt from any taxation or assessment whatever.

We looked at that situa­ tion and recognized a couple of areas which we felt we needed to do some work in. One was the development of farm buildings on farmland for non-farm purposes — in other words, the incidence where a farmer, who qualifies as a farmer and indeed does enough farming to provide himself with a livelihood, has gone into some other type of business and perhaps built a garage on his property to accommodate construction equipment or some such other occupation he might have.

We recognized that in many municipalities those buildings used for non-farm purposes were not being assessed as they could not be under the legislation, yet were a legitimate non-farm commercial purpose. So the changes in the legislation and the regula­ tions will provide that farm buildings are going to be

April 21, 1980 ALBERTA HANSARD 463 subject to assessment and taxation to the extent they're used for non-farming purposes. In addition to that, Mr. Speaker, we looked at some of the very extensive agribusiness enterprises that exist in this province. We recognized that many existed on a quarter

section or less, where the capital investment was very extensive but the assessment and taxation were almost non-existent — very, very small in relationship to the municipal services that were used — and that there needed to be some changes with respect to the level of taxation those individuals might pay. Mr. Speaker, this is one area where I was unsuccessful in coming up with what I think is an appropriate defini­ tion of agribusiness or an appropriate level of taxation. But I did want to raise it as being an area where I think we need to do more study over the course of the next year.

The original proposal, which in fact I had last November, was to implement within the legislation a provision that would allow us to assess and tax agribusi­ ness by placing an agribusiness tax on those entities that might yield some considerable amount of revenue to municipalities but, at the same time, not be so extensive that it might place those businesses in jeopardy and leave them in a position where they may not continue to exist.

So after a fair amount of work, and looking at what was being proposed or was operational in other provinces across Canada, I concluded that we did not have time, in order to move with these very urgent proposals before you today, to develop an appropriate definition of an agribusiness. In other words, does that agribusiness feed- lot start with the feedlot that feeds 500 head, or does it start with 1,000 or 2,000? What kind of income, if any criteria, are we looking at? Or are we looking strictly at the assessment of the property of the agribusiness or the farm?

In addition to that, how do we assess or tax such a business? There are all kinds of question marks with that pro­ posal. I'm hopeful, however, that over the course of the next year Members of the Legislative Assembly, and others across the province who are interested in that proposal, would lend me some of their thoughts with regard to how best we might implement a fair and equitable system of taxation with respect to very large agribusiness operations. If we could then move to the question of farm resi­ dences, Mr.

Speaker, perhaps the most contentious aspect of assessment in rural Alberta over the last several years has been whether and to what extent you assess a farm residence. Never in the history of this province have the farm residences of farmers who qualify as farmers been assessed. A number of proposals have been advanced over the course of several years. One is simply to assess every farm residence the same as you do any other residence; a second one is to assess the residence and the farmer's land holdings, and tax whichever one is higher, commonly referred to as the either/or concept.

I suppose a variation of that is to assess the farm residence and the parcel of land, whether that be a quarter section, 40 acres, or something less, and then put in place the either/or concept; that is, assess whichever one is the higher. That was the popular position of the members of the Associa­ tion of MDs and Counties until very recently. It is one that we gave a great deal of thought to, but finally discarded because, in my mind, of the very complex problems with the actual mechanical operations of such a system. Finally I concluded, Mr.

Speaker, that it was necessary to assess farm homes to some extent, because of the growing number of very valuable and large residential accommodations in this province, particularly next to our major metropolitan centres, that were escaping, I sup­ pose, with little or no tax.

So we concluded that it was fair and reasonable — and "fair" and "reasonable" are the operative words anyone considering this matter should consider — fair and reasonable to assume that an average farmer in this province ought to have an average home, being a home that, without land, would cost about $50,000 to $55,000 to construct in 1980, and that that average home would be exempt from assessment. I have commonly referred to that as a 1,200 foot 3-C home, as it's defined under assessment legislation. However, it need not be a 1,200 square foot home.

Depending on the quality and age of the home, it could well be 1,600 square feet and still be exempt from taxation. What we're really talking about is the level of assessment that would be attached to a brand new urban home of about 1,200 square feet with full basement and all the amenities one might expect in a modern home. Mr.

Speaker, that decision to assess all farm residences and provide for a blanket exemption of the first $28,000 of assessment in 1979 — which will change and move up annually as the cost of building moves up — was not one that was made lightly; one that I think is sort of middle of the road between not assessing farm residences at all, as we are doing now, and the other extreme, I suppose, of bringing in an assessment in total on every single farm home in Alberta. I've had a number of people express a view contrary to the proposal that has been put forward and suggest all farm homes should be assessed.

I only need to remind them again that this business of farming is not one where costs can be passed through as it can be in almost any other vocation, including a number that I've been in in this province. Quite frankly, I think we need to move slowly in this area of placing extra taxation loads on the agricultural industry. I, for one, am prepared to take the criticism of the exemption that might exist, recognizing the difficult times that individuals in the agri­ cultural industry often have. We could move from there, Mr. Speaker, to non- farmland.

Basically, that's all land which is not classified as farmland by way of the individual's qualification as a farmer. The existing situation is that non-farmland is assessed at 15 per cent of its value in the year previous to its being assessed — the brochure says 1978; that was in 1979. If we were assessing it in 1980, we would assess non-farmland, under the existing system, on the basis of 15 per cent of its market value in 1979. The buildings on that non-farmland would be assessed at 45 per cent of 1963 replacement cost. The new proposal, Mr.

Speaker, is to assess the build­ ings at 65 per cent of the previous year's assessment cost, which will mean a slight increase in the assessed value of buildings on non-farmland. By the way, I will explain the increased levels a little later in connection with the graph that all of you have in front of you. When it comes to land, however, the proposal is to assess at a percentage of market value only the amount that's in use, to assess the amount that's in use or the first 3 acres, and then to assess the balance at farmland rates. I think this particular aspect of the proposals, Mr.

Speaker, involves a very substantial recognition of the concerns expressed by acreage owners in this province over the last few years. Many of them have acreages in excess of 3 acres — 5, 10, 15, 20, 30 acres — and were subject to paying market value taxation on all that land, even though much of it might be tree-covered or in some

464 ALBERTA HANSARD April 21, 1980 kind of agricultural production. Certainly there are those who still suggest that, as a group, the acreage owners' share of taxes in a rural municipality will be high. This proposal does provide a very substantial concession, in my view. Bear in mind that an average 3-acre homesite in the rural part of the county of Strathcona, for example, is about the same market value as a residential lot in the hamlet of Sherwood Park.

So the situation exists now where an equal home on an acreage of, say, about 20 acres in the county of Strathcona is paying about double the tax that the same home is on a city lot in the hamlet of Sherwood Park. These changes will provide a situation where the taxation on those two homes is very little different. In other words, the country residential person will have his assessment on the balance of land over 3 acres, or whatever is in actual use, reduced very substan­ tially by assessing that land at agricultural values.

That, coupled with the fact that the total increase in acreage owners' assessment is less than most every other class, will provide a very considerable amount of assistance. We could move then very quickly through the balance of the proposals. Commercial, non-farm residences, in­ dustrial buildings, will be increased to 65 per cent of current replacement cost, depreciated from 45 per cent of '63 replacement cost depreciated. Machinery and equip­ ment will move to 65 per cent of current depreciated replacement cost.

But I want to make a comment about the level that existed in 1963: 22.5 per cent of 1963 depreciated replacement cost, which in 1963 was only half the amount that other property values were set at. The reason for that quite frankly, Mr. Speaker, was that in 1963 much of this machinery and equipment related to the oil and gas industry, and a need was perceived in that day — and I think it was correct — to provide a break for owners of such machinery and equipment so that they might continue to provide an appropriate job opportunity in this province and be able to provide themselves with some profits as well.

Obviously things have changed from the day when Ontario didn't even want to buy our oil and gas. Now I think some considerable profits in the oil and gas industry will allow them to be charged in terms of an assessment at the same level of other classes of property. Electric power and pipelines, again, were assessed at 45 per cent of '63 replacement costs, but there was a 50 per cent immediate depreciation that then remained constant throughout the life of that facility.

The proposal is to move those again to 65 per cent of current replacement cost, but to alter quite dramatically the amount of fixed and immediate depreciation. The 1963 theory was based on the fact that over their useful life electric power and pipelines would depreciate from 100 per cent to zero. If they had a lifespan of 40 years for example, it was reasonable to assume that a 50 per cent depreciated level constant over the 40 years would be appropriate.

But a new assessment of that decision has indicated that indeed, over the useful life of a power line or pipeline, as long as it's still operating, its value is probably very close to 50 per cent of its replacement cost. So we suggest that elec­ tric power lines and pipelines depreciate over their life span from 100 per cent to 50, and that it's more reasona­ ble to put in place 25 per cent as an immediate deprecia­ tion that would then remain constant. Main and branch railway lines, Mr. Speaker, were set at $1,000 per mile in 1905.

I suppose recognizing a number of things, the Crowsnest Pass freight rate per­ haps, the fact that other modes of transportation, the highway systems and so on, were built and funded almost totally by government, our proposal to keep them current with other levels of property, perhaps paying some more — and they will — is to move that to $10,000 a mile. That in no way reflects 65 per cent of replacement cost or anything near it, but was judged to be reasonable under existing circumstances. Mr.

Speaker, if there is any dras­ tic change in the Crow rate benefit that's received by western Canadians, it may well be that I would be back in this Legislature again reviewing the assessment on rail­ ways, both main and branch lines. Oil well lease sites: a nominal taxation of $100 per well site has been in place since 1963. We're proposing that that be moved to $1,000 a well; once again a taxation level which we think fair and appropriate under existing circumstances, and certainly not a burden on the industry. I could make the same comments, Mr.

Speaker, with respect to generating, metering, regulating, communica­ tions, and substation equipment as I made with respect to machinery and equipment. In 1963 those facilities were set at half of all other assessed property; in other words 22.5 per cent instead of 45 per cent of depreciated re­ placement cost. Our proposal is to move those to 65 per cent of current depreciated replacement cost. Mr.

Speaker, if I could move fairly quickly to some other matters that, I suppose, are even more important than the existing situation and the proposed situation: the question of what actually happens when you get your tax bill. MR. DEPUTY SPEAKER: I regret to interrupt the hon. minister, but the time had elapsed. Could he have the unanimous consent of the Assembly to continue? HON. MEMBERS: Agreed. MR. MOORE: Mr. Speaker, I'll try to conclude as quick­ ly as I can. I've outlined the proposed changes in a graph which is before hon. members.

That simply indicates the level of increase in farmland, for example, slightly over six times. Non-farmland, your residential land, if you like, will move up about four and a half times. But that's based on an assessment of every acre at market value. If an indi­ vidual has more than 3 acres, 20 acres for example, the increase would be significantly less than the four and a half times. Residential buildings, once again your country subdivision acreage owner, move up about five and half times, and that would be constant right across the board.

Then we have commercial/industrial buildings, ma­ chinery and equipment, each particular one showing the number of times that their assessment will increase. Finally, Mr. Speaker, I'd like to come to another matter that I think is important for the Assembly to think about; that is, the ability we have on page 7 of Bill No. 13 for municipalities to make further adjustments.

I've been asked by some municipalities, what will happen if we lay on a new general assessment and have a class of property tax payers, be it farmers, country residential, or whatever, that increases in a fairly dramatic way, say a 30 or 40 per cent increase? What can we do? For that reason we designed the legislation so that you were able to have three different mill rates in a municipality, if it's deemed to be absolutely necessary. The lowest mill rate must be equal to at least three-quarters of the highest mill rate.

Between those two differences, between say 30 and 40 mills, residential property can have one assessment, which must be the lowest at 30 mills, farmland can have another mill rate, at say 32 mills, and finally commercial/

April 21, 1980 ALBERTA HANSARD 465 industrial and other property could be set at the maxi­ mum 40 mills. It's my belief, Mr. Speaker, that for acreage owners these assessment changes will result in a general lowering of actual taxes paid and an increase in the order of 10 to 15 per cent in the first year with respect to agricultural land, and then remaining fairly constant beyond that.

But if, in fact, we move into municipalities that do not have a current, up-to-date assessment, and very extensive in­ creases occur as a result of bringing in a new assessment at the same time as a new method of assessing property, then they would have the flexibility of this split mill rate provision in the legislation to correct any inequities that they may feel exist. Finally, Mr.

Speaker, it's our intention to implement these proposals as soon as possible, but to recognize that with the number of municipalities we have across this province, it will only be possible to do perhaps six, eight, or 10 municipalities in one year. There are some that have had a recent current assessment and will be easy to do; others will take much longer. It will be our objective to do every rural municipality in Alberta as soon as possi­ ble, but that actual assessment work may take as long as three or four years. Mr.

Speaker, I could just conclude by saying that in my belief it's not possible to have a system of assessment and taxation that can't be criticized with respect to some inequities that might exist. I think it's one of the most difficult areas that government has to work in, certainly in Municipal Affairs. But I believe the proposals before you are the very best we can have in 1980, ones that have had a great deal of thought and work with respect to many, many citizens of this province. I ask the support of Members of the Legislative Assembly for the passage of Bill 13. MR.

DEPUTY SPEAKER: Before we continue debate on Bill 13, I wonder if the hon. Member for Three Hills might have unanimous consent of the Assembly to revert to introduction of visitors? HON. MEMBERS: Agreed head: INTRODUCTION OF SPECIAL GUESTS (reversion) MRS. OSTERMAN: Thank you, Mr. Speaker. It gives me a great deal of pleasure — and it's a very unexpected one — to introduce to you two people from the municipal district of Rocky View, which is immediately adjacent to Calgary and on the south part of my constituency. They are Reeve Louise Feltham and Councillor Harry Wigle.

They have a great deal of interest in the Bill under discussion this afternoon. I would ask them to rise and receive the welcome of the House. head: GOVERNMENT BILLS AND ORDERS (Second Reading) Bill 13 The Municipal Taxation Amendment Act, 1980 (continued) MR. STEWART: Thank you, Mr. Speaker. I want to commend the minister for his detailed explanation of a very complicated piece of legislation that has taken a lot of hard work on his part and on that of his department.

I think the graph he's passed around to us this afternoon indicates that we are trying to achieve proportioned as­ sessment relative to the services that municipalities are expected to provide. I think the most difficult part of any legislation is when you find one segment of assessment frozen for a long period of time. It gets completely out of relationship to its value.

With decentralization and industrialization, and the fact that throughout our province we're developing a large group of rural people who are living on small acreages, a complete reassessment of our system of taxa­ tion in municipal areas had to be looked at.

In my estimation, we've gone as far as we possibly can to equalize the opportunities of rural expansion in an industrialized way, recognizing that a large portion of our province has a lot of natural resources that have become almost half the taxation base in some areas, some munic­ ipalities and, correspondingly, with changes in agricul­ ture, a more fair taxation method on oil well sites, generating stations, and things of this nature. The services that municipalities are expected to provide to the oil industry place a heavier burden on the road systems they're expected to provide.

Consequently, I think that type of industry is putting a heavy burden on municipalities for additional road services and higher upkeep. Relating that also to the acreage people, we're expected to keep a good system of arterial roads that lead out to these acreages. I believe this new system of assessment, while it will have its indoctrination pains, will result in a more fair and equitable system of raising the money municipalities will have to have to provide these services. There's no doubt in my mind that farmers have historically been suspicious of change.

I guess it's by nature that we feel reassessment will ultimately mean more taxation. This doesn't necessarily follow, but it's the natural inclination of anyone to feel that if his assessment goes up, he's going to be subject to additional taxation. I believe the taxation of agribusiness, which the minis­ ter discussed, is a knotty problem and not easy to draw a conclusion on. With my experience in agribusiness, a lot of them have grown from strictly a farm operation to the point where it's hard to draw the line between a large farm and what has actually become an agribusiness.

I had the experience, while involved in agriculture, of growing from what was a ranch and a personal feedlot to what ended up as a ranch and a commercial feedlot. It was done during the period of time when I felt the addition of that particular enterprise was an asset to the area. We had a surplus of grain in the country, and a more mechanized system of cattle feeding seemed to be the only solution to the problem. Under today's standards, I would recognize that as an agribusiness.

But it's pretty hard to draw the line on what percentage of it would actually be equitable taxation, when you consider that agribusinesses located throughout the province are an asset to the agricultural economy as a whole. In most cases the grain that's fed in those proba­ bly doesn't travel any farther to the feedlots than it does to the local elevator. So while recognizing that everyone should pay an equal and equitable share, we also have to recognize the assets a lot of our agribusinesses create to our total agricultural economy.

I hope the taxation of that type of industry will recognize the additional assets it produces throughout the province. I suppose my total assessment of the assessment is that

466 ALBERTA HANSARD April 21, 1980 where you historically have railroads frozen at a fixed figure since 1905, and our land values at $40 an acre, the longer we leave an unpalatable problem, the bigger the problem becomes. What we're now doing is taking a large step forward, moving something that has been historically frozen, but also recognizing that we will be reconsidering these at five-year intervals. Because as time goes on, there's no doubt that inequities will develop again.

This is the unfortunate part of any type of enterprise where we're trying to establish who should be paying for the funds required for municipal services. We all recog­ nize that the people on acreages in some parts of the province have been paying an extremely high tax com­ pared to their fellow citizens who decided to stay in the urban centres. We have a lot of land in this province that doesn't have high agricultural value.

It seems that as our population grows, we're going to find more and more people prepared to drive that extra mile to work for the privilege of living on 2 or 3 acres and having some form of rural environment to raise their families in. I think this a healthy situation. Raising a family in a rural atmos­ phere has a lot of advantages. A lot of our recreation can be self-generated, and it creates a better family spirit when families can go cross-country skiing from their back door.

I think we should be encouraging this on land that doesn't have high agricultural value, and the taxation should reflect the fact that they are not being penalized for this privilege. I hope this change in assessment, once it's properly understood, will be accepted by the people. I'm quite sure there are a lot of misconceptions and a lot of apprehen­ sion among people who have been only partially inform­ ed of the facts. I hope that the distribution of pamphlets which explain properly how the assessment works will alleviate a lot of the concerns I've heard expressed.

In most cases a simple explanation of the fact that farm buildings other than large farm homes are not going to be taxed — a misconception a lot of farmers had heard and were concerned about. I think that agribusiness, while it's going to be an ongoing concern and problem in a proper assessment, will have to fit its proper role and pay its proper share of taxation. With those words, Mr. Speaker, I will conclude my concerns and express my support for this taxation. DR. BUCK: I just want to make a few brief comments, Mr. Speaker and members of the Assembly.

I would like to apologize to the minister that I had to be in and out. But I will read Hansard, and in committee stage of the Bill we will be doing more evaluation. The first thing I'd like to say to the hon. minister is: has the minister indicated if the Bill will go through third reading and receive Royal Assent at this spring session? The minister has indicated he didn't make any comment on that. I feel this is one Bill that should be held until the fall. I know the present government has made a lot of promises that they would never tax farm homes. But that's what we're doing.

So I guess you can't always believe what this government tells you. I would like to say to the minister that he's going to have to — and he's certainly come full circle from the time only one or two years ago, 18 months ago, when he said there's no way we will ever tax farm homes. So I'm going to see just how the minister gets himself out of this problem. Mr.

Speaker, I'd like to say to the hon. minister that last year when I brought the resolution to this Assembly — the entire problem and situation as it applies to assessments, to acreages, to farmland — a legislative committee should have been struck, even though the minister says this problem has been studied many, many times. If we had struck a legislative committee, we would at least have taken some of the politics out of the situa­ tion.

Members of both sides of the Legislature would have looked at the thing, not only as it applies to municipalities and to assessment of mill rates, but also to find out what the people out there really think. Too often we get the information we want to hear from people who want to give us that information. So I think the consideration of striking a legislative committee would have been very apropos. But the ques­ tion of increased assessment — I always find that politi­ cians, be they at the provincial, federal, municipal, or county level, are really no different.

They tell us one thing; then sometimes they forget what they've told us. When we look at assessment going up, most people assume the mill rate would go down. Maybe the minister will remember the story I brought to his attention last year, where the assessment of some people in the county of Strathcona increased many, many times, but they didn't know their taxes were going to escalate tenfold. They thought, well, if my assessment goes up 10 times, my mill rate will come down according­ ly; therefore there will be very little change. But it didn't happen that way, Mr. Speaker.

The people who made representation to me said, well, in essence a sort of speculative tax was being levied, where the taxes being 100 years before, with the new assessment the taxes went up to $1,100 — ten or elevenfold. So, Mr. Speaker, to the minister: if everything's going to be reassessed, let's have some guarantee that the mill rates will reflect that increase in assessment accordingly. Now I know we all strive to have fair and equitable taxes.

In this province for many, many years — and I'm not blaming just this government; I'm blaming the previous government — the taxes have been a long way from fair, and a long way from equitable. So the problem is not just this government's. I'd like to speak very briefly again — I'm not going to re-thrash old straw when we had the debate here on my recommendation to have a legislative committee struck — on how acreages are just not paying their fair share. They are paying much more than their fair share. I'm sure the hon.

Minister responsible for Personnel Administration is going to get up and tell us how his acreage owners are paying much more than their fair share. The acreage owner has to pay his gas services, his water services, and his power; he does most of his snow removal; and many, many other services people in large urban centres take for granted. They say, oh well, that's fine for the acreage owner; he's got all that peace and quiet, plus all those weeds, of course, as the Minister of Agriculture well knows. The acreage owner is paying for those.

At the same time, we ask him to pay a proportionally higher share of taxes, without getting the services people in major centres take for granted. Another area of concern, Mr. Speaker, is the system of appealing assessment. I made the point that people do not realize they have to appeal when the assessment notice comes out. By the time the tax notice comes out, brother, it's too late. Many people think that if the assessment has gone up, the mill rate will go down, so there won't be too much change. But when they get the tax notice, they find out they've passed the deadline for appealing their assessment.

So we will see, and we have seen, many, many backlogs of appeal cases. The portion I'm sure the minister will address himself

April 21, 1980 ALBERTA HANSARD 467 to, especially when we're in committee study, is that I guess we'll never really figure out how to define who is and who is not a farmer. I guess we've been trying to do that for many, many years. The minister, being a bona fide farmer . . . Now maybe he's not a bona fide farmer, because he probably makes more money from politics than he makes from his farm. MR. MOORE: I'm still a good farmer. DR. BUCK: He's still a good farmer.

Well, if he's making more than $60,000 being a farmer, I'll tell you he's a super good farmer, because there aren't too many who make that kind of money. The question has been with us for a long, long time, and it's one that I'm sure this minister will not be able to resolve. Another area that concerns me is the fact that reas­ sessment will now be lowered from eight years to five. Mr. Speaker, I'm sure the minister has looked at the system they're using in British Columbia.

I don't know if it's a good system or a bad system, but surely in this day of computers, I don't think we should have to wait even five years to have a complete reassessment. I'd like to know from the minister if there are counties or municipal­ ities in this province that have not been reassessed for more than eight years. I've heard some rumors there were, and I'd like the minister to indicate to us if that is a fact. I see we're going to have to look at the split mill rate, which has been used to try to solve some of our prob­ lems. Sometimes this seems to cause us as many problems as it rectifies.

I would also like the minister to address the problem of alleviating a problem the local jurisdiction will have in trying to define a farmer. So, Mr. Speaker, the problem is real. I appreciate the fact that the minister is trying to address this problem. I really feel that because of the wide ramifications of what the minister's doing — when we had the promise from the minister and the government just a short while ago that we would not be reassessing and taxing farm homes. In light of that, I think the people out in rural Alberta had better be aware of what this government's doing. Mr.

Speaker, I would certainly ask the government to strong­ ly, strongly consider holding this legislation over for the summer. If we're genuinely interested in having input, I think we can have the summer to get that genuine input from the taxpayers across the province. Therefore, Mr. Speaker, I say to the minister: the government should give strong consideration to having this bill held and not receive third reading until the fall sitting of the Legislature. Thank you, Mr. Speaker. MR. DEPUTY SPEAKER: The hon. Member for Stony Plain, followed by the hon. Member for Edson. MR. PURDY: Mr.

Speaker, I think the hon. minister has to leave, so I'll give him my place. I'll follow the minister. MR. STEVENS: Mr. Speaker, I'd like to thank the Member for Stony Plain for allowing me to enter the debate at this moment. In getting on my feet at this point I'm rather amused to be able to respond to some of the comments made by the Member for Clover Bar. I was just realizing as he spoke that he perhaps has been in and out of the Assembly, but he still seems to be dancing along this fence.

He talks about amendments he would like to have seen introduced at some time, if we'd had a legislative committee, and that this would have taken politics out of the review. I find it rather amusing that a legislative committee would have removed politics. I'm very pleased that our caucus has, with the advice of the Minister of Municipal Affairs and the work of his officials, put in long and hard hours on this matter which has led to the amendments before us today. There are 79 distinct constituencies out there.

Representing Banff- Cochrane, I suppose I have no more and no less a unique constituency than any other member. In speaking about Bill 13, first of all I would compli­ ment the minister and his officials for this very compre­ hensive

summary which has led to important and signifi­ cant changes before us. During the campaign that led to the election in March 1979, in travelling about, as each of us here in the House has done, I spent time with officials of the municipal district of Rocky View 44 and the municipal district of Foothills. In our last Legislature, I recall the motion by the MLA for Highwood, unanimous­ ly endorsed, which called for immediate review and steps leading to amendments which would put right the inequi­ ties in the system that have been described so well by the minister.

I met with representative groups such as Un- ifarm, and the Alberta Association of Municipal Districts and Counties. I spoke to over 5,000 individuals in my area. These included small-holding owners, acreage ow­ ners, and agriculture business owners, particularly in Springbank and the Cochrane district. I talked to asses­ sors, farmers, and ranchers. I attended a number of meetings, including a meeting in November of a large ratepayers organization in our area called the Bearspaw- Glendale ratepayers association. Yes, there are a lot of people concerned and a lot of questions.

As the Member for Wainwright said, as information is provided to our constituents and to their representatives, I believe they begin to understand more and more the ramifications of these proposals. I'd also compliment the minister, too, on his officials. On one occasion the assistant deputy accompanied me and presented the early proposals we had discussed. I've also spent time going over these concepts with the editors and reporters of our weekly newspapers. I really believe these proposals before us are a substantial improvement over our existing situation.

As the minister has indicated, agricultural holdings are justified in receiving substantial tax relief, because this is an industry where the costs cannot be readily passed on. There's no question also that in the overall situation in most municipalities, taxes will shift away from acreage owners to farmholders and the industrial sector. That is a concern, particularly in an area where there is a very, very old assessment base — 1967 in the municipal district of Rocky View, a portion of which is in Banff-Cochrane.

I believe the department and the minister have directed all their efforts towards reach­ ing a reasonable and fair proposal. It has to take into account not just Banff-Cochrane, but all 79 constituencies and the diverse viewpoints and situations throughout Alberta. I very much understand the concern of the reeve and council of the municipal district of Rocky View in my area. They do have a very special problem; that is a very large municipality — I believe the largest municipality by size in Alberta — representing a very diverse group of people.

The situation there involves rapid urbanization and a number of so-called hobby farmers. I believe the resolution of the difference between a farmer and a non-farmer is still ahead of us, but these amendments

468 ALBERTA HANSARD April 21, 1980 which provide for an exception for our farm residents as described by the minister will go a long way towards solving this particular problem. In fact, I understand that assessors have commented that, except for some small holdings, the new changes do shift the burden of taxation onto industry and business. Taxes will increase in those areas after the assessment amendments are considered and approved and the assessment picture changes. It does make it less advantageous for hobby farmers.

As explained by the minister in his presentation, if they try to abuse the system, they will still face the fact that 3 acres will be like a normal lot in a municipality as opposed to a hobby lot, and the rest of the land will be assessed on the new $240 basis, with the exception apply­ ing for the farm or hobby farm residents. But beyond that $28,000 exception, the full effect will be felt. I believe the proposals that have been referred to us now are valid, Mr. Speaker, and I support them fully.

I understand the minister has indicated to each of us here today that he would look towards receiving our further input on the agriculture business proposals. But I believe the farm residence exemption is a big step forward, and I believe that the split mill rate will assist the constituents in Rocky View, a portion of which, as I mentioned, is in Banff-Cochrane. I do support the proposals as being, in the words of the minister, the very best in 1980. Thank you, Mr. Speaker. MR. PURDY: Mr. Speaker, I'd like to spend a few minutes this afternoon in the debate on Bill 13.

I spoke in this Legislature last fall supporting the resolution of the Member for Highwood regarding municipal taxation. I support the legislation of the hon. minister, but I do have a couple of questions for the minister and a bit of concern regarding some of the assessment areas we're looking at. Through my constituency organization, I struck a committee in my constituency to look at this particular problem. They've been working at it very ac­ tively for about the last month and a half or two months. They've put together some information that I'll share with the members today.

Maybe it can be looked at later when other amendments to The Municipal Taxation Act are brought forth. The present system of taxation isn't fair and equitable, because many people are not paying the tax they should be. I believe the new system outlined in Bill 13 will certainly eliminate some of the problem we have. But I have one concern with the 3-acre parcel in the legislation, which I'll come back to later. With the

definitions under

Section 2 of farm buildings, farmland, and farm residence, I think we can now define a farmer more definitively than before. The question asked many times is: what is the purpose of municipal taxation? It's to provide transportation facilities, schools, transportation to schools, and many other lesser services to the residents of that MD or municipality. These serv­ ices are provided equally, regardless of distance from schools, trading centres, or primary highways, and regar­ dless of the respective incomes of residents. Should we not be looking at other procedures, then?

I look at the person who has a more than average home in a rural area, town, or village. He pays extra taxes for it. So there are some injustices in the whole scheme of assessment. The person who has the same income may not put it into a home; he may take two holidays a year. He's not taxed on that. But if a person puts broadloom in the living room, a double fireplace, and things like that, he's assessed higher than the individual who hasn't gone that route. So I think there's some unfairness in the whole procedure within our assessment manual as it now stands.

Going back to the 3-acre point in Bill 13, the minister touched on it. I think he was getting at the point I may try to make. He was comparing a 3-acre parcel in the county of Strathcona with a residential lot in the hamlet of Sherwood Park. But I'd point out to the hon. minister that the person who lives on that 3-acre parcel does not get the police services, the fire services, and other services that the person does in the hamlet of Sherwood Park. There's an inequity there.

My concern with the 3 acres — and this is the only concern I have, because my mail tells me there's no concern with the present procedure we are looking at of taxing farm residences with the $28,000 exemption, and the many other good features of the Bill. But about two years ago the county of Parkland moved to 3-acre parcels and only 3-acre parcels in new subdivisions. So anything west of Stony Plain to Wabamun is pretty well 3-acre parcels. In essence, what I am saying is that the proposed legislation will not benefit those people.

It will certainly benefit the small holder who has 5 acres, 15, 20, or whatever the case may be. The group we put together came up with five very important points. I'll just place them in front of the members of the Assembly, and they can look at them. We started off with a

preamble that people should not be assessed or penalized for improving their home or taking

part in its appearance. But we should also not be en­ couraging shacks in order to reduce taxation. So, number one, everyone in the municipality should be taxed on an equal basis, regardless of income. Everyone should pay from his pocket a minimum tax, be it $200 to $300 — that's something that can be looked at afterwards. But that $200 to $300 would look at what is required to provide that basic county service. Number two, every home should be taxed regardless of its size or the size of the property on which it stands. We're doing this.

The home is where the demand for service comes from: from the family who has children going to school, and from the automobile using those county roads. Point number three: if a resident of a municipality owns more than one parcel of land, then that particular parcel should be assessed and taxed in the normal manner. In other words, if he's renting one out, that comes back under the old system, and it's taxed as we are now doing it. Number four was that consideration should be given to the farmer. In taxing a farmer's land, you are in effect taxing his job or business.

For no other type of employ­ ment does the county collect taxes from an individual's job or source of income. I just elaborated a bit on point five, but I'd like to go into it again. No assessment or measuring should be done on the residence because of a fine home or not so fine home. If a person wishes to spend his money on cars, holidays, travel, antiques, let that be his choice. But if a person wishes to spend his money on the home and beautification of the lot, the acreage, and so on, let's not penalize him. I think all citizens demand and deserve equal service, and that all taxation should be equal. MR.

WOLSTENHOLME: Thank you, Mr. Speaker. I guess I have the green light.

April 21, 1980 ALBERTA HANSARD 469 MR. DEPUTY SPEAKER: I hesitate to interrupt the hon. member, but I've already recognized the hon. Member for Edson. MR. WOLSTENHOLME: You can have the green light. DR. REID: Mr. Speaker, there is some confusion in the backfield this afternoon. Mr. Speaker, it may seem a bit unusual for me to get up and address the subject of rural taxation, because I think I've stated several times in this Legislature that I don't have many farmers in my constituency; I have an awful lot of trees.

But a considerable number of acreage dwellers live in the Edson constituency, and we do have some farmers — admittedly beginning farmers, and farm­ ers on marginal and not very productive land. First of all, I would like to congratulate the hon. minister for having had the temerity to get involved in the subject of rural taxation so early in his term, and to commend him for his efforts to review and to do some­ thing about the problem. Of course, the problem, is not really with rural assessments; it's with rural taxation. I think the negative remarks of the hon.

Member for Clover Bar sounded a bit out of place, in view of the problem that exists. The Bill that the hon. minister has brought forward includes several quite radical changes in the whole con­ cept of rural assessment. It's my feeling it will go a long way to correct the problems that exist, that have been increasing historically over the last several years, and which within the last few years have been introducing the possibility, if not the certainty, of considerable friction between acreage dwellers who are not farmers and their neighbor farmers.

I'm sure nobody, including the hon. minister, and cer­ tainly not myself, expects that this Bill will satisfy every­ body who lives outside the urban areas of the province. I think that is expecting a miracle. But the Bill as intro­ duced will certainly go a long way to reduce the problems that exist.

In view of the willingness of the minister to address the problem, I'm also sure that he will be careful¬ ly monitoring the effects of the legislation and will almost certainly be showing considerable willingness to review any inequities that may result and, hopefully, to do something about any that cause severe problems. Indeed, if the minister hadn't been willing to get into that process of review and correction, we wouldn't be discussing the Bill today. [Mr.

Purdy in the Chair] In a few brief moments, because I'm sure lots of members want to talk on this subject, I would like to address several parts of the legislation before us. First, I would like to address the subject of farm residences and the exemption that has been introduced. While I know it will cause some heart-searching in some constituencies where there are large numbers of acreage dwellers, I think the concept of exempting a basic farm home but taxing beyond that level, really is a good concept.

It will enable us to tax farmers who are fortunate enough and affluent enough to build a 5,000 square foot house with a swimming pool and triple garage, who at the moment pay no tax on that dwelling. On the other hand, as the minister said, the limit of approximately a 1,200 square foot basic home will be of considerable benefit to farmers who are on marginally productive land, especially the beginning farmer who has invested most of his capital in his farmland and equipment.

That beginning farmer es­ sentially will be exempt from tax on his farm home during his early years and that, along with the programs introduced by the Minister of Agriculture, should help him considerably. On the other hand, if that possibly mythical farmer, with 5,000 square feet, the proverbial swimming pool and triple garage, is doing well enough to be able to afford to live in that kind of house, I think that, just like the acreage dweller with a similar home, he should be paying some reasonable taxes upon that amount of his home in addition to the basic exemption.

The important thing on the subject of the taxation of farmland, as the minister has expressed so well, is that the upper limit is $260 per acre. For a large part of this province the assessment per acre will be considerably less than that. For the few farmers I have in my constituency who are largely farming on quite shallow, gray-wooded soils, their assessment per acre will be considerably less than $260.

Of course, it's interesting to note that the assessment on non-farmland beyond the first 3 acres will also be based on that concept of its value as farmland, so that those who hold acreages larger than 3 acres, where the agricultural value of the land is extremely low, will be equally assessed on that low value. The next subject I would like to address is the 3-acre concept. If my memory serves me correctly, in the debate last fall I suggested a 1-acre concept.

That was based on some information I had, based largely on the constitu­ ency I represent, where in actual fact the value of acreages is considerably higher than it is elsewhere, large­ ly because of a lack of land since we live in the greenbelt. This problem may continue to exist. If it does, I'm sure my constituents will monitor it closely, and I will hear about it and pass their remarks on to the minister. However, the 3-acre concept does help a large number of the acreage dwellers in the greenbelt of the province. The previous legislation really prevented the development of so-called acreages in that area.

It essentially was a matter of cutting off more than 20 acres so that you were a farmer, not officially but unofficially, as a 20-acre plot was the minimum farm. So a large number of the existing acreages in the Edson constituency, and I think in some other constituencies in the greenbelt, are in excess of 20 acres. Those people will benefit considerably from the reduction of assessment on those acreages in excess of the 3-acre limit.

As I said, my constituents who find that 3 acres with a market value in excess of $20,000 and assessment of somewhere in the vicinity of $15,000 I'm sure will be communicating with me pretty early in the game. The other points I would like to address are essentially the increase in taxation on pipelines, power lines, rail­ roads, and other non-farm equipment. The increase in the assessment on these parts of the tax base and the increase in taxation on farmland will of course broaden the tax base considerably, and the result will undoubtedly be to reduce mill rates considerably.

Whether that will in actual fact reduce the net taxation will depend on the individual arithmetic of the property and possessions of an individ­ ual taxpayer. I would like to commend the minister for trying to broaden the tax base, trying to some extent to equalize the treatment of residents of rural areas, and thereby removing to a considerable extent the inequities that have been gradually building up under the present system. I welcome the changes in the legislation. I'll be monitoring them, and I'm sure some of my constituents will as well. Thank you.

470 ALBERTA HANSARD April 21, 1980 MR. WOLSTENHOLME: Mr. Speaker, I'm very pleased to speak this afternoon on Bill 13, as proposed by the hon. minister, especially as it follows along something of the debate that took place last fall on my Motion No. 214 which, in effect, asked the government to reconsider as­ sessment and taxation particularly as it affected the rural areas of Alberta. It was well debated, and passed. So I am very pleased to see this Bill on the Order Paper. I must commend the minister for his remarks on Bill 13.

He covered it so adequately that he doesn't leave much more to say, unless I am to repeat what I say last fall, and I don't think that's necessary. I think the hon. Member for Clover Bar must have been fishing on the weekend, because he sure scattered around quite a few red herrings this afternoon. The minister and his staff deserve a great deal of credit for a job that was well done, in my view.

As a former member of a municipal council, I realize the problems involved in trying to come up with an equitable, reasona­ ble answer to a very intricate and complex problem, especially when you realize that property tax is the major source of revenue for a municipality and that the resi­ dents of that municipality have to pay that tax. I'm sure it's been a real headache to come up with this, in my view, reasonable and equitable application of the pro­ posed Bill No. 13.

As the minister stated last fall when we were discussing my Motion No. 214, there was no point in making changes for the sake of changes, because in that case it would likely just relieve some that were in problems with taxes then, but would just pass it on to another group of taxpayers, and that isn't desirable. In the past there were many inequities in taxation assess­ ment, in my view, mainly because there was a problem in not being able to designate properly what a farmer is or was. There's going to be a real need for an understanding of the difference between assessment and actual taxes paid.

I think for the minister and his department properly to communicate this to the taxpayers out there will be a real challenge. Hopefully this educational program will assist the average taxpayer to understand the difference be­ tween his assessment notice and his actual tax notice. I have a very large number of acreage owners in my constituency, as well as large owners of land who farm/ ranch. So it's a real challenge to come up with anything that goes anywhere near relieving both sides and still try to be equitable. Of course, I realize that it won't please everyone.

But I have to stand here in my place and recommend it as a very real improvement over the old method of assessment and taxation. I recommend it for real consideration. Thank you. MRS. FYFE: Thank you, Mr. Speaker. I'd like to offer a few comments on Bill 13 this afternoon. I notice from the discussion we had on assessment last time that the Member for Clover Bar still seems to demonstrate a lack of knowledge and an understanding of municipal taxa­ tion.

Some of the comments he made certainly made me wonder whether he is arguing in favor of having reduced taxation applied to both acreages and farms at the same time. If he were to understand that municipal taxation is a total program, assessment based on all the properties within that municipality, and that the municipal council sets a rate to raise the amount of money needed to provide municipal services — and in addition to munici­ pal services, school services, senior citizens' homes, and a very small levy for hospital taxation, which I think in­ cludes improvement of parking lots.

We have X number of dollars in a total package required each year. In order to raise the required number of dollars, a mill rate is applied against the taxation of each property. [Mr. Appleby in the Chair] I realize that there has been considerable concern on the part of acreage owners that they have been paying the lion's share of municipal taxation in rural municipalities, I think with some justification. I appreciate their concern. I think the hon. Member for Clover Bar has tried to compare the situation within the county of Strathcona to all other rural municipalities.

I think that is a particularly unique situation, where we have probably the largest hamlet in Canada — 30,000 persons with hamlet status. So there may be some inequities between acreage owners in that municipality compared to what they are paying in urban areas. But we mustn't lose sight of the fact that we are concerned about taxation across the province. I think this Bill goes some distance in trying to rectify that disparity faced by acreage owners.

If we were to have taxation that reduced the acreage assessment to a much larger degree, on the other side of the coin we would also have the concerns that would be raised by the farming segment of our population. The farmer is indeed concerned that if his municipal taxes are raised to an excessive degree, this discourages people from staying on the land. I think this is a very important factor. If farmers are encouraged to leave because of high taxation on their homes or land, we have really forced the family farm out of business and into large farming corpo­ rations.

I think it's a very healthy thing to fly across the province of Alberta and see a multitude of lights on the land, knowing people are living there, not having moved miles and miles away and only coming out during the productive seasons of the year. A second factor relates to the exemption of farm build­ ings from assessment. If we were to assess all farm build­ ings the same as any other business, it certainly would also have the effect of providing a very heavy burden on the farm family. I think it has been recognized this afternoon, Mr.

Speaker, that the farmer cannot pass on his costs the same as a retailer, manufacturer, wholesaler, or other type of business. So this afternoon, while this may not rectify all the problems that are faced in rural Alberta, I think it's one step forward. With the five-year reassessment included in the Bill, I believe we won't be going for a 20-year period as we have previously, where the assessments on farmland have remained unchanged for such a very long period of time and no longer are realistic. With those brief comments, Mr. Speaker, I would lend my support to second reading of Bill 13. MR. OMAN: Mr.

Speaker, I will make just a very few brief remarks on the Bill. First of all, I want to congratu­ late the minister for bringing in what I think is a courageous and indeed advanced piece of legislation. Property tax, in fact any tax — I don't know where you'd find a tax that would be universally acclaimed as being a fair tax. Bringing in new taxation principles is never a particularly popular move, and creates a lot of tension and unease among people. I'm sure this has done the same, although my own constituency lies entirely in an urban setting.

I think to be fair, property tax should be assessed equally on all property at fair market value. I suppose if

April 21, 1980 ALBERTA HANSARD 471 there's criticism about this, it could have been a lot worse, in the sense that if that definition is fair it would indicate that certainly farm houses and all farm property should have been assessed in it. Therefore, I think the minister and his department have been bending over backwards for legitimate farmers in the way they have brought this in.

One of the weaknesses, of course, in property taxes generally is that they never reflect a person's ability to pay — as against income tax, which directly affects the ability to pay — for he may be taxed simply because he has large holdings, which don't necessarily produce capi­ tal. A change may therefore present unnecessary hardship at times. I recall several years ago when the city of Calgary — along with the city of Edmonton and, I think, all other urban areas — was required by the province to bring its assessments up to date; in other words, to reflect current market values.

One of the things that happened was that we'd been allowed to go so long before we did this that there were some rather marked changes over a period of a decade or more. One of the things we found was that some of the smaller houses close in downtown were on properties that had mushroomed in value. Therefore,

whereas the house maybe was worth very little if any­ thing, the assessment of the land — which was ripe for development of, say, high-rise apartments and so on — was very, very high. Most of these properties were owned by senior citizens who were on limited and fixed incomes. So it did create a hardship. When that was revealed, some fine tuning was done, and the province gave special help to those people who were in a special bind. The minister has explained well — and again I'm not going to go into detail with regard to its effect, because many of my colleagues have done this.

However, I just want to re-emphasize and underline the minister's state­ ment to the effect that higher assessments do not neces­ sarily mean higher taxes. In fact, they may mean lower taxes, simply because of the way the tax load is being divided. Obviously, however, the municipality should not need more money. This is not a scheme to raise more money; rather it's a scheme to raise it more equitably. Higher assessment on one property likely means a higher assessment all the way across the board and, therefore, there would undoubtedly be a reduced mill rate.

I recall again that when the city of Calgary went through this — and I think, if anything, we need to do it more often rather than less often, particularly bringing the assessment up to date — there was a flood of calls when people received their assessment notices. But when the final tax notices went out there was great relief, generally speaking, across the populace. Some people who thought they were really going to be soaked found that they were getting off relatively easily. So I conclude by summarizing, Mr. Speaker. It's a matter that needed to be done because there were great inequities in the rural scene.

It took considerable courage to do it, and I commend the minister for doing it. I don't think we should delay it; it should be done now. It will not be as obnoxious or onerous as it appears to be at first blush. I appreciated the minister's statement that it will be fine-tuned to take out the bugs once they are realized. Thank you. MR. BATIUK: Mr. Speaker, I would like to participate on Bill 13. I enjoyed listening to the other members participating, and I give the minister a lot of credit for having the guts to bring in this legislation that has been looked for for many years.

Not totally do I agree with all the members who spoke today, and that's why I decided at the last minute to make a few of my own observations. As a county councillor for a good number of years, I have lived with that problem of trying to define what a bona fide farmer is. There had been many areas and even the assessment manual had different areas at times. One that we dealt with for several years was that if a person residing on a piece of land 20 acres or more could prove he had an income good enough to provide a living, the equivalent of a senior citizen's pension, he would qualify as a farmer.

The problems came with people who were employed, teachers or any others, making from $15,000 to $17,000 a year, yet he would have a fine home, a fine garage, and some other buildings, and he was exempt from taxation. He just paid a few dollars on his land because he was able to show that on that little piece of land he kept probably two ponies. He'd sell a colt for $1,500, and he had the money just from that. It was a real problem, and I don't think we ever came to see that everybody paid his fair share.

However, I cannot agree with some of the members who have made statements today that all homes, regard­ less where, should be taxed. There is the difference. I could see that anybody putting up a home for half a million dollars in the rural area maybe should be taxed. If he can afford that much for a home, naturally he could put in a few hundred or a few thousand dollars for taxes. But what really perturbs me is usually the tax is set to raise funds to provide services. Now I just can't see what services there are to a home on the farm.

In town you are provided with water, sidewalks, street lights, natural gas, police protection, fire protection. That's all included for your tax dollars. But on the farm, if you want to have a water system, it's going to cost you from $4,000 to $6,000 to $8,000. If you want a yard light, which you have right in the town, it costs you $7 to $9 monthly just for the outside light. If you want natural gas, it costs you from $2,000 to $3,000 to install it. Nowadays electricity costs up to $5,000. So, as I say, if the home were taxed according to the one that is in town, it's definitely not right.

However, in his formulations in this Bill I think the minister has provided exemptions for people in homes that are necessary homes. A home of 1,200 square feet, or whatever it is, is a home that can give you reasonably good living. If somebody else has a home much greater, probably a few dollars more will not hurt. I have spoken to a number of farmers over the last while, and it seems everybody is against more taxation. But this Bill was in no way intended to derive more money. It would give the municipalities a much easier job to provide equitable taxation.

So I must say I support this Bill, and it's a pleasure to participate. MR. HYLAND: Mr. Speaker, I'd like to, make a few comments on this Bill. First, Mr. Speaker, I'd like to make note of the

section that deals with putting irrigation land on a different system of assessment from what it was previously. I remember about three years ago — and it showed the very problem when assessment is left too long, the very thing the Member for Calgary North Hill was talking about, when assessment on pieces of ground is left for so many years before a general reassessment and what happens to it. It happened in the county of Forty Mile. It was quite a number of years before reas­ sessment, and a lot more of the land had become irrigated in that 8- to 10-year span. With reassessment and the

472 ALBERTA HANSARD April 21, 1980 former way assessment was done on irrigation land, some of the assessment increased threefold or fourfold, with the resultant increase of the taxes twofold and plus. So there are problems with letting assessment run for such a number of years instead of having it reassessed in the time limit that's supposed to be there. I attended a meeting in Medicine Hat three weeks ago that dealt with the new assessment, particularly that relat­ ing to farm homes. There was quite a bit of activity in the meeting, to say the least.

The concern expressed there was over the taxation of farm homes and over the increase in assessment in general. Once explained to people that the way it was proposed to be done — it's the same old story. They see the story; they hear an increase in assessment, and assume that that will drive the taxes up sixfold or whatever the increase in assessment may be. Many people don't realize the workings of a municipal government or an ID. They don't realize it takes so many dollars to run the operation, that that is spread out over the total amount of the assessment, and thus the mill rate is arrived at.

As previous members have said, that mill rate is to provide service for the operation of the municipality. But the concern that was expressed, and I'm sure the minister can do away with that, was the fact that taxation of houses, even with the exemption of the 1,200 square feet or thereabouts and an amount put on the assessment, is the first step toward taxation of the other buildings on a farm. For examples they were using areas in the States where farm buildings are taxed and where you don't see very many good buildings on farms.

Another part of taxation — I haven't noticed it in the Bill, and maybe the minister can comment on it — is that related to the greenhouse industry, most prevalent in Redcliff and Medicine Hat, and their taxation in an urban area in producing an agricultural crop. They have fairly high taxation on their establishments, and it is creating a great deal of concern for them. Discussions have been going on for at least the last three or four years relating to this taxation policy. In general, Mr. Speaker, I believe the people out there now understand Bill 13, as it's getting explained better.

When he makes the necessary corrections and distributes them, I'm sure the pamphlets the minister has passed around will help a great deal towards explaining the new assessment policy and the need for reassessment every number of years. As some members have indicated, maybe even the allotment in the Act, as things are changing so fast, is not the appropriate amount and it should be reconsidered as well. I'd like to leave those few comments for the minister to comment on when he closes debate. MR. DEPUTY SPEAKER: Has the hon. minister per­ mission to close debate? HON. MEMBERS: Agreed. MR. MOORE: Mr.

Speaker, first of all I want to thank hon. members for their participation in second reading of Bill No. 13, and for their positive attitude toward its implementation and passage during the spring session. I want to emphasize one particular aspect of this Bill again, but I think the Member for Calgary North Hill did it better than I could when he explained very effectively that an increase in assessment doesn't necessarily mean an increase in taxation, and for those who consider them­ selves to be paying more than their fair share can often­ times mean a decrease in actual tax dollars paid.

The most recent example of that is the city of Edmonton which a year ago brought in a new method of assessment in the entire city resulting in a situation where the assess­ ment increased by, I believe, 5.5 times. That of course resulted in a very dramatically decreased mill rate. I think that fact was well explained in a brochure that went to citizens with the assessment notice some time before the actual tax bill went to the citizens of the city of Edmonton. I think it's that effective communication job that is necessary. Mr.

Speaker, a couple of other points — and of course I'd be prepared to answer a number of questions in committee study. I was asked about what might be per­ ceived by some as an outdated method of assessment where in fact in past years we went to every quarter

section of land, looked at the soil again and it hadn't changed much from previous years. It's our intention to bring in a system of assessment that will keep an assess­ ment current every single year. In other words, there shouldn't be the need to do an eight-year general assess­ ment.

Rather we should have in place a qualified asses­ sor, part- or full-time, in every single municipality in this province whose job it will be, given the very extensive information now provided to municipal governments through building permits and so on, to place new assess­ ments on the roll and to keep that assessment updated with changing conditions. Very obviously that is going to be coupled with com­ puter systems. The staff in my department are now working to try to develop it so it can be laid onto a municipality without them doing the cost of research and so on that might be necessary for a good system.

So very definitely it's our wish that down the road we have updated assessments, which means that you don't have a dramatic change occurring if you haven't done one for a number of years. To answer the question whether or not there are as­ sessments in this province older than eight years old, the answer is yes, there are a number. The legislation says they must have a general assessment every eight years unless the minister signs a ministerial order allowing them to continue beyond eight years with their existing assess­ ment.

There are some for which my predecessor and I have authorized an extension beyond that time frame. Part of the reason is that we knew we were working on a new assessment proposal that might provide them with greater equity, and so that was done. Finally, a couple of comments with regard to the last speaker's concern about the greenhouse industry. We are looking at changes that might be effective in assisting farmers who own farm buildings in urban areas. Present­ ly the situation is that they are assessed and taxed as though they were non-farm buildings.

That creates some problems, particularly with respect to annexation, where we move lands into urban areas which aren't required for urban purposes for perhaps 20 years down the road. Within the next month or two I hope to have some answers to that problem that would be effective in the property taxation year 1981. In conclusion, Mr. Speaker, it is our intention to move during the spring session with third reading and Royal Assent of this legislation. If we don't, it means another year. If we wait till fall it really means that we're delaying by one year the very change that the hon.

Member for Clover Bar and others have been asking for; that is, to provide some assistance to those whose property is based on market value and the market values are increasing very dramatically, while a good part of the other property

in a municipality, such as farmland, is based on a fixed assessment or on replacement cost which has not been increasing nearly as fast as have market values, particu­ larly the areas adjacent to our large urban centres. So we want to move this year. I just say in closing that the Association of MDs and Counties did consider this matter by way of a resolution at their spring convention, when they asked that the provincial government delay third reading of the legisla­ tion until the fall sitting of the Legislature to allow further study and input. That resolution was defeated at their spring conference.

So I think an awful lot of people involved very directly in this business want to ensure that we move with this legislation in the spring of 1980 and put it into place as quickly as possible. Mr. Speaker, as I indicated earlier and want to say again to hon. members, I will have a replacement for this particular brochure, within a week I hope, that will have the correct figures as I've outlined them today. If hon. members could wait until then, I know we'll be prepared to provide copies in large volumes to members who request them.

We'll also be forwarding copies of this brochure to every municipal district office in the province and other places where interested citizens may have ac­ cess to them. Mr. Speaker, with that I ask for the support of the Assembly, and move second reading of Bill No. 13, The Alberta Municipal Taxation Amendment Act, 1980. [Motion carried; Bill 13 read a second time] MR. DEPUTY SPEAKER: Before we proceed to the next Bill for second reading, might the hon. Member for Three Hills have permission to revert to Introduction of Bills? HON.

MEMBERS: Agreed. head: INTRODUCTION OF BILLS (reversion) Bill Pr. 6 The Prairie Bible Institute Amendment Act, 1980 MRS. OSTERMAN: Thank you for your indulgence, Mr. Speaker, and members of the Assembly for their indulgence. I request leave to introduce Bill Pr. 6, The Prairie Bible Institute Amendment Act, 1980. This amendment Act will allow the bible institute to grant degrees in divinity. [Leave granted; Bill Pr. 6 read a first time] head: GOVERNMENT BILLS AND ORDERS (Second Reading) (continued) Bill 9 The Electric Power and Pipe Line Assessment Amendment Act, 1980 MR. MOORE: Mr.

Speaker, as I indicated, my com­ ments on Bill No. 13 also included discussions with re­ spect to the principle of Bill No. 9. I would recommend its support by members of the Legislature. [Motion carried; Bill 9 read a second time] Bill 37 The Unfair Trade Practices Amendment Act, 1980 MR. KOZIAK: Mr. Speaker, in rising in my place to move second reading of Bill 37, The Unfair Trade Prac­ tices Amendment Act, 1980, I would like to urge all hon. members to indicate their support for the amendments and their continued support for the concepts embodied and codified in The Unfair Trade Practices Act.

Hon. members will recall that this type of legislation is fairly recent in the parliaments of this country. The idea behind it, or the objective for legislation of this nature, is to provide suppliers with a minimum standard of conduct in the marketing of consumer goods and services. I suppose this standard can best be described as "truth in selling". With this concept in place, we feel that consum­ ers will benefit through improved trade information and will be in a better position to make independent and rational choices.

As we indicated in our Speech from the Throne and other documents, it is our firm belief that the best protection for the consumer in the market place is to be an educated and well-informed consumer. Because the number of choices that a consumer makes daily, multip­ lied by the number of consumers in the field, would indicate the impossibility of a government making those decisions for consumers, even if a Legislature were so politically bent. At the same time, Mr.

Speaker, it provides benefit to business in that shopkeepers, those who provide goods and services, are not required to compete with others who maintain a philosophy of providing for unfair business practices in their dealings with consumers on a day to day basis. Hon. members will probably be interested in knowing that since 1975, 2,868 complaints, as of March 31 this year, have been dealt with by the director of trade prac­ tices and his staff under this Act. In enumerating those complaints, we found that less than 5 per cent were unfounded.

Also of interest to hon. members is the fact that in that period of time, over $306,000 has been refunded to consumers in this province who have been disadvantaged as a result of practices performed which were prohibited by the Act. I should indicate to hon. members that probably the most significant in terms of dollars and numbers was one in which I was personally involved in terms of some of the negotiations. That was with General Motors of Cana­ da Ltd. relative to the sale of motor vehicles, Oldsmo- biles, Pontiacs, or what have you, with Chevrolet engines.

In other words, a consumer in the province thought he was buying an Oldsmobile and subsequently found that that Oldsmobile was powered by a Chevrolet engine. What's significant in this, Mr. Speaker, is not that the Oldsmobile had a Chevrolet engine, because if you want to put a Chevrolet engines in an Olds, a Rambler, or a Ford, you can do so. The important thing is that the consumer should be made aware of that when he makes the purchase so he isn't under the false assumption that he's buying an Oldsmobile engine.

Through the provi­ sions of this Act, we were able to provide restitution for consumers in the amount of $200 cash plus a 36-month warranty and certain other benefits in the event that repairs as a result of breakdown were necessitated prior to the warranty being put into place. So that's one signifi­ cant example, Mr. Speaker, of how the Act is used on a April 21, 1980 ALBERTA HANSARD 473

474 ALBERTA HANSARD April 21, 1980 day to day basis. Over the course of the history of the Act, the director of trade practices has sought about 55 undertakings from the suppliers of goods and services in this province. When I say undertaking, that really amounts to what would be a cease and desist order directed toward the tradesman or businessman, plus an undertaking not to perform that type of an unfair trade practice in the future.

These undertakings may be accompanied by restitution for a consumer; they may be accompanied by a penalty pay­ able to the government of the province of Alberta for the costs of investigation. They'll of course provide for the cease and desist concept, and the undertaking not to proceed in the future. These undertakings are a matter of public record, Mr. Speaker, and are kept on file at all the regional offices of the Department of Consumer and Corporate Affairs.

Some other examples of the use of the Act would include an undertaking obtained from a firm that adver­ tised in the yellow pages that it had the sponsorship of the Better Business Bureau when in fact it did not. An undertaking was obtained in that particular case. Further areas would be in the body beautiful area, if I might head it up that way. We see many advertisements nowadays in the press that promise all kinds of things in terms of weight control and other inducements that will result in our greater attractiveness, so it seems.

One particular establishment advertised that its process would permit a client to lose between 8 to 20 inches of fat in just one sitting. Our investigations found that that was hardly the case, that the representations of that particular salon were never in fact met. An undertaking was obtained from that business not to continue with advertising in that area. Just a few examples, Mr. Speaker, of how The Unfair Trade Practices Act is used on a day to day basis.

At the same time as I make those comments and indicate there are three areas of amendment I'll come to specifically, I also would like to state that this is an area of the law which if unfairly administered would provide great difficulty for us in this Assembly and for both consumers and business people in the province of Alber­ ta.

Fortunately, since the proclamation of the Act on January 1, 1976, we have had an administrator who has approached his task and responsibility fairly and with — I suppose I could use that phrase that someone else once used: for a wise man a rule is but a guide; for a fool it's the law. We have had a wise man in the administration of this Act, Mr. Speaker. I pay that tribute to Mr. Douglas Carr as the director of trade practices, because we are the eve of his promotion to further and better things within the government of the province of Alberta.

I felt that I would like to place on record my appreciation for the diligent and fair way in which he has administered this Act to this time. I would also like to pay similar tribute to our head of consumer relations division, who has, I'm sure, imprinted his fair-minded influence on the adminis­ tration of the overall

section of the department which has responsibility in this particular area of the law. In speaking to the three specific amendments, as hon. members will quickly find by reading the short Bill, we're expanding the definition of services when it comes to the question of private dwellings to include not only repair and maintenance, but also improvement. We have had situations, Mr. Speaker, where businesses have made some fairly rash promises with respect to improvements to dwellings and, as a result of those promises, have encouraged and induced consumers to enter into con­ tracts they might not otherwise have had.

Fortunately, until this time we have been able to rely on the Act as presently written in order to provide the appropriate redress. However, there may come a time when the situa­ tion may be responded to by a statement that what we have is not a repair or maintenance situation, but an improvement situation. It's my recommendation to the members of the Assembly that we consider positively the amendment to cover that situation. As I mentioned during the course of first reading of the Bill, Mr.

Speaker, we're also expanding the jurisdiction of the Provincial Court to include the responsibilities up to the appropriate dollar limits of the judicial administration of this Act in addition, of course, to the overseeing role the Queen's Bench of the province of Alberta now provides. Finally, Mr. Speaker, the third amendment is a clarifi­ cation as to the estimates clause, to ensure that consum­ ers do not enter into an agreement based on a particular set of estimates which are subsequently increased substantially. With that, Mr. Speaker, I urge all hon. members to support Bill 37 on second reading. DR.

PAPROSKI: Mr. Speaker, just very briefly, I'd like to make a few comments, and indeed compliment the department for its action under The Unfair Trade Prac­ tices Act. As the MLA for Edmonton Kingsway, I've had the opportunity to refer problems to the department on a number of occasions, and the results were very positive indeed; if no positive action was taken, at least a clarifica­ tion which resulted in a satisfactory situation for the consumer and the business alike. Mr.

Speaker, the number of complaints, cited by the minister, that have been dealt with over the years as a result of this particular Act, truly tells a story. I think all citizens in Alberta are very pleased and happy to have such

an Act. I'm sure the senior citizens in our province will be extremely pleased with the amendments, because of the home repair program the senior citizens are using very diligently to upgrade their homes. I'm pleased that the minister and the department con­ tinue surveillance and positive action on behalf of all consumers, as well as businesses, as he indicated, in a balanced way, recognizing that those same citizens in fact operate businesses in many, many cases, and may be affected by another business. I hope the minis