Manitoba Hansard — 19 May 1992 (Sitting 67B, 35th Legislature, 3rd Session)

35-3-67b

Manitoba — Debates (Hansard)

Third Session • Thirty-Fifth Legislature of the Legislative Assembly of Manitoba DEBATES and PROCEEDINGS (HANSARD) 39-40 Elizabeth II Published under the authority of The Honourable Denis C. Rocan Speaker VOL. XLI No. 678 • 8 p.m., TUESDAY, MAY 19, 1992 Printed by the Office of the O,_,s Printer. Province of Menltoba ISSN 0542-5492

MANITOBA LEGISLATIVE ASSEMBLY Thirty-Fifth Legislature Members, Constituencies and Political Affiliation NAME ALCOCK, Reg ASHTON, Steve BARRETT, Becky CARSTAIRS, Sharon CERILLI, Marianne CHEEMA, Guizar CHOMIAK, Dave CONNERY, Edward CUMMINGS, Glen, Hon. DACQUA Y, Louise DERKACH, Leonard, Hon. DEWAR, Gregory DOER, Gary DOWNEY, James, Hon. DRIEDGER, Albert, Hon. DUCHARME, Gerry, Hon. EDWARDS, Paul ENNS, Harry, Hon. ERNST, Jim, Hon. EVANS,Ciif EVANS, Leonard S. FILMON, Gary, Hon. FINDLAY, Glen, Hon. FRIESEN, Jean GAUDRY,Neil GILLESHAMMER, Harold, Hon. HARPER, Elijah HELWER, Edward R.

HICKES, George LAMOUREUX, Kevin LA THLIN, Oscar LAURENDEAU, Marcel MALOWAY,Jim MANNESS, Clayton, Hon. MARTINDALE, Doug McALPINE, Gerry McCRAE, James, Hon. MciNTOSH, Linda, Hon. MITCHELSON, Bonnie, Hon. NEUFELD, Harold ORCHARD, Donald, Hon. PENNER, Jack PLOHMAN, John PRAZNIK, Darren, Hon. REID, Daryl REIMER, Jack RENDER, Shirley ROCAN, Denis, Hon. ROSE, Bob SANTOS, Conrad STEFANSON, Eric, Hon. STORIE, Jerry SVEINSON, Ben VODREY, Rosemary, Hon. WASYL YCIA-LEIS, Judy WOWCHUK, Rosann CONSTITUENCY Osborne Thompson Wellington River Heights Radisson The Maples Kildonan Portage Ia Prairie Ste.

Rose Seine River Roblin-Russell Selkirk Concordia Arthur-VIrden Steinbach Riel St. James Lakeside Charleswood Interlake Brandon East Tuxedo Springfield Wolseley St. Boniface Minnedosa Rupertsland Glmli Point Douglas Inkster The Pas St. Norbert Elmwood Morris Burrows Sturgeon Creek Brandon West Assiniboia River East Rossmere Pembina Emerson Dauphin Lac du Bonnet Transcona Niakwa St. Vital Gladstone Turtle Mountain Broadway Kirkfieid Park Flln Flon La Verendrye Fort Garry St.

Johns Swan River PARTY Liberal NDP NDP Liberal NDP Liberal NDP PC PC PC PC NDP NDP PC PC PC Liberal PC PC NDP NDP PC PC NDP Liberal PC NDP PC NDP Liberal NDP PC NDP PC NDP PC PC PC PC PC PC PC NDP PC NDP PC PC PC PC NDP PC NDP PC PC NDP NDP

3462 LEGISLATIVE ASSEMBLY OF MANITOBA Tuesday, May 19, 1992 The House met at 8 p.m. COMMITTEE OF SUPPLY (Concurrent Sections) RURAL DEVELOPMENT Mr. Deputy Chairperson {Marcel Laurendeau): Order, please. When the committee meetin g in P.oom 2551ast sat, we were considering item 4.(

a) Salaries $362,90 0. Shall the item pass? Ms. Rosann Wowchuk {Swan River): I have a couple of ques tions on thi s section. This department deal s with the Depar tment of Environment with the environmental impact assessments. Can the minister let us know which areas or what particular environmental impact assessments the department is working on right l"lOW? Hon.

Leonard Derkach {Mi nister of Rural Development): The Provincial Planning branch assists in such things as site selection for a variety of companies that may, in fact, be interested in locating in the province or in some of the communities in rural Manitoba or in the province as a whole, and some of the types of ones that we are dealing with is the BFI site selection for waste disposal. Still others that are being worked on are such things as the Churchill Rocket Range, for example. It would be one that the branch might be working on as well. Ms.

Wowchuk: Is the department doing any work on the environmental assessment in cutting in the parks and the impact that is going to have on rural communities? Mr. Derkach: Mr. Deputy Chairperson, no, there is no work being done by this department on the impact studies of those. That is something that is completely in the purview of the Department of Environment. Ms. Wowchuk: It says in here, natural resources related conflicts and land use policy, and that was why I was asking about the land use of the parks cutting.

Also, you have mentioned that they are dealing with large companies that might be establishing in the rural communities. Has this department been involved at all with the proposed environmental impact assessment on the Repap operation? Mr. Derkach: Mr. Deputy Chairperson, because the branch itself provi des assistance and information for the establishment of companies or acts as an advisory, if you like, to the Department of Environment where matters relate to this department, we have a membership on the technical advisory committee.

Basically, as a member on that committee, we would be involved in terms of providing advice from the planning perspective. *

(2005) Ms. Wowchuk: Has the person who has been involved with the environmental assessment-can you advise us whether any work has been done as far as the environmental assessment of the Repap operation? Is that happening? Mr. Derkach: There is nothing specific or there is no one particular initiative that I can relate to except to say that the work of the committee is ongoing, and they are addressing the issues as they relate to Repap. We have membership on that advisory committee, but there is not anything that I can point to as being a specific initiative that has been undertaken. Ms.

Wowchuk: Going on to another area, it says the branch will continue to assist the department in Rural Development initiatives. One of the issues is rural gasification, and I believe that means bringing natural gas out to rural communities. The previous minister indicated that he was in support and would like to see natural gas brought out to other areas of the province. Can the minister tell us what his position is on this and what studies are being done as far as bringing natural gas to more communities in rural Manitoba? Mr. Derkach: Mr.

Deputy Chairperson, we are certainly in favour of rural gasi fication to communities where there is a need for it. Of course, in rural Man itoba that would benefit every community. However, having said that, we have to be cognizant of the fact that gasification to any community is a very expensive undertaking. It cannot be done overnight, because you have to do

3463 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 a lot of work in terms of doing evaluation of the impacts that this will have on those communities, surrounding communities, et cete ra. We have done some work in terms of rural gasification as a department, but we are certainly not at a point where we can make any formal announcements of any kind at this time. Ms.

Wowchuk: Could the minister tell us which areas of the province are being studied or whether any money is being put into studies at the present time, areas that have been identified as areas that could use or he would like to see natural gas going into? Mr. Derkach: Mr. Deputy Chairperson, there is not any one specific community or communities that are being sort of isolated or being picked as the ar eas that might be ones where natural gas would be extended to.

The branch or the department is working with Centra Gas, because they are the people who would be the proponents or the installers of natural gas to communities. We are looking at an overall plan. We are looking at some of the needs that have been expressed. We will be worki ng with those communities to see whether or not it is even fea sible to extend natu ral gas to them. Of course, Centra will not extend gas to a particular area unless there is some reasonable return on their investments, so that is always a consideration. Ms.

Wowchuk: Can the minister tell us which commun ities are being looked at right now as possible communities to have-the ones that t hey are working along with Centra Gas to have them gasified? *

(2010) Mr. Derka ch: As I in dic ated , Mr. Depu ty Chairperson, there is no specific community or communities that are being looked at. I think what we are looking at as a department with Centra Gas is how we can address this in a general way, and in doing that one will have to look down the road at which commun ities can probably benefit fr om natural gas most, which ones can support the installation of natural gas by the industries that t hey may have within their communities.

Thirdly, which communities are perhaps ones that natural gas can be extended to in a natural sense where there may be a pipeline existing already or one that is pointed in that direction and can be extended fairly quickly and without a great amount of difficulty. So it is more of an overall approach than it is-and we are in the very preliminary stages of that. I would have to say that trem endous amounts of work still need to be done in a general sense before we can start becoming specific about specific communities. Ms.

Wowchuk: I hope that the minister will pursue this matter because if he is serious about economic growth in rural Manitoba and having industry come to rural Manitoba, this is one of the key elements. There is not an indust ry that is going to look at a smaller community unless they have an alternate source of fuel, and I think it is very important for all of those com muni ties that are lookin g at development and looking at ways to diversify. The minister said th at they were working along with Centra Gas on this.

I want to ask the minist er: Is government putting any money into these studies or are the studies being funded by Centra Gas or what are the government's contri butions to these rural development initiativ es? In particular again I talk about, as an example, out of all of the ones that are listed here, gasification. Mr. Derkach: Mr. Deputy Chairperson, I might say that the work is presently being done intern ally. So there is not any specific amount of money that has been allocated to a study that is going to be done jointly by communities and Centra Gas.

The work that is being done is of a preliminary nature, and it is being done inter nally by staff within the department as it exists now. I might add that it is a high priority, but, you know, we have just been there for three months or so, or four months, and it is not something that we can give a great deal of response to at this time. There are other energy issues as well that are sort of interrelated especially when you start tal king about economic development in rural Manitoba. Those are such things as three-phased power to the rural communities, to the farm sites as well, along with natural gas.

It is a fairly complex area because there is quite a demand for natural gas in all of our small communities. As the member knows, we are a long way from servicing a majority of the province with natural gas. Mr. Nell Gaudry (St. Boniface): Mr. Deputy Chairperson, I would like to raise the full matter of Provincial Land Use Policies. It says, lead the developmen t, evalu ati on, adjustment, and implementation of Provincial Land Use Policies. Can the minister explain the process? Mr. Derkach: I am sorry, can I ask that the member rephrase his question again?

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MANITOBA 3464 Mr. Gaudry: Mr. Deputy Chairperson, in regard to the implementation of Provincial Land Use Policies, can the minister explain the process? Mr. Derkach: There is a fai rly elaborate process that is undertaken by the department with regard to how we implement the provincial land use policies. First of all, the branch has responsibil ity for implementing this, but they do not do it without a great deal of consultation with a variety of groups.

When a parti cular land use policy or plan is embarked on, a number of steps have to be undertaken before it gets to completion. Rrst, the department will do its own preliminary analysis and recommendations and that sort of thing. Then that will be sent out to a variety of organizatio ns.

I might say these include local government districts, prof essional associati ons, environmental resource groups, and other institutions such as the Institute of Urban Stud ies perhaps, the Manitoba Historical Society, the Heritage Federation, the chambers of commerce, the Archaeological Society, just a host of other interest groups with regard to provincial land use . Then, of course, it will come into our interdepartmental planning group who will do an assessment of it. Following that, it will go to the PLUC comm ittee of cabinet who will make a recommendation to cabinet for approval. • (2015 ) Mr.

Gaudry: When do you expect to come up with a recom mendation? I know there was some concern when Bill 45 was presented here, and the people of Manitoba had the opportunity to respond and they ex pr es sed concerns wit h the amendments. Mr. Derkach: I am told that the public consultation will be completed by the end of June, and then it will come in for acting on the responses, if you like, from the public. So we are talking about sometime in the fall of this year for implementa tion. Mr. Gaudry: There will cert ainly be public hearings for the public at a later date . Mr.

Derkach: The process that I describe that it is in now until the end of June is the public consultation process, if you like. After that the process is complete , then it is adopted as part of regulation . Mr. Gaudry: You say there is a public input at this stage till June 30? Mr. Derkach: That is correct. Mr. Gaudry: Therefore, if anyone wants to make representat ion or recommendations to the cabinet, what is the process for them to do it at this sta ge? Mr. Derkach: It is through the public consultation process. Mr.

Gaudry: Will there be advertisement of where they can make their presentation or what proces s is involved? Mr. Derkach: Mr. Deputy Chairperso n, the stakeholders are the groups that have been advised with regard to making comment. Comments may be sent directly to the branch from anyone, not just the stakeholder groups. Indeed, if the public at large want to make representation they can send their comments directly to the branch. Ms. Wowchuk: I have one more question in this

section and that is dealing with the round tables and the community vision statements. What is the next step when a community puts their vision together and sends it in? What is the next step that happens? I am hoping that there is some follow-up to work along with the communities once they have put these plans in place. H there is, who deals with them, and can we have any idea of the progress? Have some of them gone on to the next ste p? Mr. Derkach: Mr. Deputy Chairperson, it depends on the initiative, I guess, but all of the round table plans, if you like, or statements are sent to our department.

We do not approve them or reject them. Instead, we simply would share them with those departments that may be impacted by that.

In terms of a community setting its vision, if you like, for the future and the types of initiatives that they may want to undertake, which is quite separate from their vision state ment, they could then, based on their vision stat ement and on the initiatives they may want to undertake , they could apply if it fits the model for either Grow Bonds funding for a project or, in fact, for REDI funding, for assisting them in ensuring that the particular type of enterprise is attracted to the community. •

(2020) Ms. Wowchuk: Is there staff allocated, or who works along with these people once the vision has been put into place? There was a particular community that called and said, you know, we have put this proposal in, but now what? Is there going to be any follow-up work from government to help us? Are there any resources put in place that will help a community put their plan into place?

3465 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 I mean, it is one thing to say, well, there are Grow Bonds here for you and there is the REDI fund for you, but they need expertise as well. That is what I am looking for. Mr. Derkach: A good point, because it is important for communities once they have established a vision stat ement or the direction that they wish to go in, they have identified their stre ngths, it is important for them to be able to somehow access some expertise as to the second stage.

We have Regional Development offices scattered throughout the province, and we are now retraining, if you like, or we are going to be going into the retr aining of some of the staff at those. offices to ensure that they do not just perform the planning function, but indeed they become Economic Development officers who can assist communities once they have gone through the est ablishment of a vision state ment and a strate gic plan, if you like, for their communities. Ms. Wowchuk: Is the funding put in place to help these Regional Development off icers? Has the funding been made?

The Regional Development Corporations, is the funding consistent with what it was? Is there funding in place to help these officers get the training that they need to support the commu nities? Mr. Derka ch: Mr. Depu ty Chairperso n, the Regional Development Corporations are different from our Commu nity Development offic es. The Regional Development Corporations are their own entities, if you like, but the Commu nity Development offices are our own office s, our regional offices. Yes, we staff those offices with an average of four or five people. They have an area that they are responsible for.

With the communities in that area, they would work towards est ablishing such things as setting priorities for the communities, Mure directi ons, assisting them with access to programs that might be available either from our own department or perhaps from I, T and T, working in joint partnership with the comm unity to be able to access even federal programs or information to federal programs. So the Commu nity Development offices play a very, very important role in terms of delivery of the programs that we have put in place. Ms. Wowchuk: Just one more question on the round table groups.

There was funding put in place for round table groups to get st arted. I want to know, has the amount stayed the same as it was initially started out with, or has there been a change in the formula for funding a round table group? Mr. Derkach: Mr. Deputy Chairperson, the funding levels have not changed. The funding levels have remained. We have, as I indicated , 26 different communities who have accessed the community round tables money, the com mu nity Choices program. In terms of the decrease in funding, there has not been any decrease, it has remained intact. Ms.

Wowchuk: The reason I was asking, the amount of money that was set when the round tables were first set, it was completely funded by government. Are the towns now expected to match the funds, or how are the funds put in place for a round tab le? Mr. Derkach: The round tables have always been on a mat ching basis, and that is still the way it is. We will give a specific amount of money as a grant, but the community will have to contribute its portion or its share of the funding. Mr. Gaudry: It is in regard to the round tables. How are the communities select ed, or is it by application? *

(2025) Mr. Derkach: Mr. Deputy Chairperson, every commu nity that wishes to set up a Community Choices program applies to the department. To my knowledge, we have tried to accommodate each and every community that has applied and meets the criteria and can then come in with its own funding to match what government gives. From there we start working with them to get their membership and then start working with our community economic development off ices to set their vision and their goals in place. Mr. Gaudry: What are the basic criteria for the community to get the round table grant? Mr. Derkach: Mr.

Deputy Chairperson, when a commun ity applies for a Communit y Choices program grant, what we do is staff from the department will work with that community to, first of all, identify what it is that they really want to do in terms of a round table. If in fact their round table is one which is geared towards economic developm ent for the area, and wher e that community wants to better itself in an economic sense, there are some criteria that are set down with regard to what they have to establish in terms of membership, in terms of the goals and visions.

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3466 That is why we want to see a copy of their vision statement as a department, to ensure that the money that we are investing in them is not just wasted but indeed that there is something productive out of it. We work with them to develop, first of all, some of their goals and objectives and a

schedule as to how quickly they want to move towards that and so forth. It is all sent out to them, 1 might say. There is a pamphlet-! do not know if this is it-yes. There is a document that is put out by the department on the Community Choices program . It is quite straightforward and can be followed through quite easily by community members who can look at what they should do to establish a round table . Usually a community will ask for these. They will go through these, and then they will begin their work from there with one of our development offices.

Mr.Gaudry: What is the administrative cost of that program ? Mr. Derkach: In total, we have allocated $85,000 for this function. We have one staff person who has been assigned responsibility for the Community Choices program, and in terms of staff and other associated costs we have budgeted $85,000. Mr. Gaudry: I do not know if this falls under this

section here, but in regard to Headingley. It has seceded from the city of Winnipeg, and it could very well happen with the municipality of St. Germain. What is the outcome if St. Germain were to secede? •

(2030) Mr. Derkach: Although this is covered in a different section, as you know that is something that is handled by, not the Depar tment of Rural Development but the Department of Urban Affairs, until we reach a point when that community gets its status, if you like, as an independent community. In the case of Headingley, as an example, the entire process was handled by the Department of Urban Affairs until the regulations were passed and the legislation was passed, and it was as of last week, I beli eve , that Headingley came under our jurisdiction.

So up until the time that it becomes an entity of its own, this department does not have responsibility for those matters. That is something that is covered under Urban Affairs. Mr. Gaudry: The Minister of Rural Development would not get involved in regard to the assessment and things like that prior to this happening if, let us say, St. Germain were to secede from the city of Winnipeg? Mr. Derkach: Yes, that is correct. As a matter of fact, with the case of Headingley, we could not even do enum er ation, an assess men t, until the boundaries were established, until the regulations were passed.

At that point in time, we could start the enumeration and the assessment process. Mr. Deputy Chairperson: Item 4.(

a) Salaries $362, 900- pass ; (

b) Other Expenditures $32,200-pass. Resolution 11 7: RESOLVED that there be granted to Her Majesty a sum not exceeding $395,1 00 for Rural Development, Provincial Planning, for the fiscal year ending the 31 st day of March, 19 93-pass. Item 5. Local Government Services Division (

a) Executive Administration:

(1) Salaries $66,600. Ms. Wowchuk: Mr. Deputy Chairperson, this is the

section then where we would be having a new assistant deputy minister hired, responsible for municipal affairs. I want to ask the minister, when do you expect that there will be a new deputy mini ster put into place? When you talk about restructuring of the department, what changes do you see happening in this department in the next six months? (Mr. Bob Rose, Acting Deputy Chairperson, in the Chair) Mr. Derkach: Mr. Acting Deputy Chairperson, this is the new branch, if you like, or the new arm of the department.

I see a tremendous opportunity for this arm of the department, because it is this arm that will work with the communities throughout Manitoba to assist them and provide the tools for the revitalization, if you like, or whatever other term you want to use, in terms of attempting to encourage and motivate our communities to grow. This, again, is a very new branch of the department; therefore, I imagine that many of the things are still up in the air in terms of what this branch will look like in the end.

With the new deputy minister and new assistant deputies who will be coming on stream, certainly some of the things will probably change in terms of being proactive. We want to ensure that this branch is proactive in its view of rural Manitoba, that we do not just simply go out there and act as liaison, but we are out there active ly promo ting gr owth and economic development and activity. It is going to be the arm

3467 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 of the department that, I think, is probably going to try and break down some barriers as they have existed before in terms of economic development in rural Manitoba. We will be working with the municipal people . We will be working with-maybe I am talking about the wrong one. I am sorry. I am talking about the economic development arm. We are on the municipal one. Let me retract all of what I said and leave it for the other one. Ms. Wowchuk: Rnish it up and we will go on to something else. Mr. Derkach: Yes, that is the Rural Economic Development arm .

On the other one, the Local Government Services Division is probably more synonymous with the old Municipal Affairs branch where we work with the municipal organizations and municipalities to assist them with such things as assessment. We provide services for financial advice, we provide some research for the municipalities, and we act as sort of the executive administration arm for the LGDs as well. So that is sort of the function that arm would perform.

Now, in terms of when the ADMs are coming on stream, now that we have a new deputy minister we can move with the next step, because I think it is only fair and very important that the new deputy minister would have some input into the selection of ADMs. Certainly, we expect that he will have a fairly influential position in that regard, and that is why we waited to fill those positions until we had a full-time deputy minister in place . So there, I have gone through both. Ms. Wowchuk: Since the minister has opened all that up, maybe we can just ask questions all over the place in this section.

The reason I said that is I want to look then on the line of Assessment, if that is okay, or do you want to pass? I have no further questions on the executive-(

b) Assessment ra ther than Executive Administration. I am just asking for clarificati on. If you just want to paS&- Mr. Gaudry: You do not pass Administration just like that. I want to ask questions, too. Now, Salaries, you have an increase to $66,000 from $40,000. Could I have an explanation? Mr. Derkach: That is a reclassification of the position because, as you know, this is a position that is going to be an executive position and, therefore, it required a reclassification. That is why you see the figure go from $40,000 to $66,000. The Acting Deputy Chairperson {Mr. Rose): Item 5. Local Government Services Division (

a) Executive Administration:

(1) Salaries $66,600- pass;

(2) Other Expenditures $24,000-pass. Item 5.(

b) Assessment. Ms. Wowchuk: We all know this

section is a very important section, the

section that deals with the reassessment that has been delayed causing some concern in the community, and I would like to ask some questions on that. Rrst of all, I would like to know who is the head person on this department? Mr. Derkach: The deputy minister. Ms. Wowchuk: No, the person responsible for Assessment, who is that? Mr. Derkach: I guess I should introduce the staff at this point who have just joined us. We have Mr. Ken Graham, who is now the Deputy Director, acting, of course, and we have Marie Elliot who has joined us, who is director of Research and Systems. Ms. Wowchuk: You had said that Mr.

Graham is the acting director of Assessment? Mr. Derkach: Yes. Ms. Wowchuk: Can you tell me why this position has stayed as an acting position? That position has not been filled permanently since Mr. Brown left, is that accurate? Why ther'Ht is a very important position, and I do not doubt Mr. Graham's ability at it, but I question why it would stay as an acting position rather than being filled as a permanent position? •

(2040) Mr. Derkach: Mr. Acting Deputy Chairperson, you raise a good point, but I have to remind you that the dep ar tment has been under a period of restructuring, and until we have a permanent deputy minister and until we have our ADMs, we will lea ve that position as an acting one. At that point in time the people who are the executive people of the department will have some input into, perhaps, the restructuring and the promotion or the selection of people for those positions. So it is for that reason that we have left it on an acting basis. Ms.

Wowchuk: I appreciate that answer, but it did cause some concern that it would be left in that mode for such a length of time. I want to get on then to the reassessment, and I want to ask the minister why he has found it

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MANITOBA 3468 necessary to bring in Bill 20, which will delay the reassessment by another year. When I was on council and Bill 79 was coming In, we were told that everything was going to be so modem in this department. Everything was going to be so computerized that all they had to do was press a button and we could go ahead with reassessment. That is the way it was sold to us.

Then, If the equipment is all in place and it is so easy to do, why has the minister found it necessary to delay reassessment for another year rather than proceed as was the commitment from this government? When Bill 79 was being debated, there was a commitment from this government that never again would the assessment be delayed more than three years. Now that we are moving to four years, it appears to be the thin edge of the wedge, so to speak, a move by government that they can do whatever they want just to back up assessment. What kind of a commitment do we have then that this is not going to happen again?

I raise these concerns because they are very serious concerns, when you put something into legislation that is giving a guarantee that it is going to happen every three years and then having it backed up for no real known reason. Mr. Derkach: Mr. Acting Deputy Chairpers on, let me say that we have consulted with the interest groups fairly extensively with regard to the reasons for Bill 20. I would have to say that in meeting with the various stakeholders, most of the people that I have had anything to do with have been supportive of the move to delay the reassessment for one year.

I guess we explained the rationale for moving to delay rea ssessment for one year. The reasons for that were, first of all, and not in that order but- An Honourable Member: The most important is the first one. Mr. Derkach: Not necessarily, but indeed, the Education funding formula, which was introduced last year, is a fairly complex formula. Let it not be trivialized, I guess, because if you look at the impact it has on municipalities and on school boards and on individual taxpayers, it is something that does not just go away overnight.

It is something that has to be understood fairly well by mun icipalities, by school boar ds, and, indeed, by those who pay the bills. If you would place on top of that, reassessment, it would not only create some confusion in the mi nds of the taxpayers, but it would probably be more difficult then for school boards and municipalities to try and sort out and explain to their taxpayers what, in essence, all of this is about. We have talked to municipalities about that, and we have asked the questions whether or not we are viewing it incorrectly or whether, in fact, they view It in that way.

I can tell you that both UMM and MAUM and other organizations, other stakeholder groups, basical ly agree with us, that it would create some confusion in the minds-not in the minds, but simply for taxpayers and for some of the school boards and municipalities to deal with. Now, that is one reason. Secondly, as you know, we introduced the whole portioning strategy, which is having an impact as well. Now if you were to try and sort out Ed funding formula, reassessment portioning, someone would have to do a lot of explaining not only to the people who are running the municipalities but I think to a lot of taxpayers.

We looked at whether or not reassessment would have a negative impact on the property taxpayers, and by and large, it does not in a general sense, because as long as portioning is used to control taxes for each property class, delaying the reassessment is basically a nonissue. Now If you take a look at the fact that the farm class-we have talked about farming a lot and about the fact that farmers are going to be impacted fairly negatively because of the fact that farmers pay only 27 percent of their assessment, and that is based on the 1985 values.

That means that there is not a real impact on the bottom line, If you like, because in fact if values in 1 990 will drop, then it means that someone is going to have to pick up that extra cost. That is just the way it is. There is a certain amount of money that municipalities require to do their business, and so the portions were introduced to sort of apportion that burden as equitably as possible. We have talked to municipalities about this. We have talked to the various stakeholder groups, and they basically agree with us.

There are some individuals who may not agree with us, but basically the people that we have talked to as stakeholder groups agree with the fact that neutralizes the impact. The last thing that it does is it allows our department to produce better quality assessments in the end, and I guess we have to go back and look at how often reassessments

3469 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 were done before the int roduction of The Assessment Act. We have come a long way in the last four years in the entire issue of assessment, and although we would probably like to correct everything overnight, some of those things are just impossible to correct overnight and they take time to work through the system. Therefore, we are moving towards having a two-year spread, if you like. That is our goal, and we will move to that in 19 94 when the new assessment takes effect. Now that will be done in 19 93, as I understand it, to become effective in 19 94.

So we are in 19 92 already. Basically you rea lly cannot expect us to do much more than to do our homework next year for the impact to be known in 19 94. H we try to do it before then, that puts a lot of pressure onto a department that is already doing a lot of work in terms of trying to sort of streamline the assessment process. Ms. Wowchuk: Mr. Acting Deputy Chairperson , the minister has made a lot of statements, and you know he wants us to believe that this is just a very complex process and we need a lot of time to understand it. I do not know what is happening to educate the public.

H it is so complicated, what is the government doing to make the process less compl icated, to make the taxpayer understand what is going on? He talks about that the change in assessment is not real ly going to affect anyone because it is dealt with by apportioning and that will look after it, but in reality if there is somebody's property which is asse ssed way out of value in com parison to other properti es, even with portioning, he or she will pay an unfair portion of taxes in comparison to the other ones if their property is overasse ssed.

So I do not think that you can say that, well, it is all okay because apportioning looks after it. He also said that this allows the government to produce a better quality assessment, and I do not understand why you need that extra year for that better quality assessment, if, as I said earlier, equipment is in place an� do not understand. I guess I just do not see the rationale behind delaying it. ..

(2050) On the portioning

section of it now, you have said that there is a shift. The farm is now 27 percent, but there was an adjustment made in the portioning. I want to ask the minister, when there was a reduction in that portioning just this last year, the residential went down a certain percent and farmers went down a certain percent, but in reality the farm ing portion went down less than the residential. As a result, farmers are picking up a larger portion of taxes. H you could tell us, how much did portioning decrease on farm property versus business property and some of the other categories?

Other categories had a larger reduction, but farm ing In proportion had a smaller reduction. Mr. Derkach: Mr. Acting Deputy Chairperson, because of the adjustments in the residential classifica tions, there has been, of course, a shifting, if you like, of the pickup of that by other groups. However, in the end the farm group decreased by 1. 5 percent. Now, there has been some discussion, and I know in the questions in Question Period there has been the suggestion that indeed the farm class picked up a larger portion, but that is not the case. As a matter of fact, their portion dropped by a percentage point.

It did not go up. On the building part of it, the residences, that is one aspect of it; but on the total farm package, if you like, it went down by 1. 5 percent. Just by example, and maybe this may illus trate it best, in a general sense in the last four years, I guess, if you go back that far, we first of all took off the education portion, the ESL portion on farmland, on the raw farmland, and yes, there was taxation of farm residences.

In fact, if you look at the overall tax share of farm property as a whole-that means farm homes, farm land and outbuildings-it has fallen from 12 .5 percent in 19 89 to 11. 5 percent in 1992. This includes the impact of taxing all farm residences and outbuildings and, more recently, the portioning adjustments. So, taking all of those things into consideration, there still has been a decrease in the overall farm class of 1 percent. The member may say that is not enough. Perhaps it is not, but that money has to come from somewhere. The question, I guess, may be put: Who should it come from?

We have done a tremendous amount. If you compare what this government has done to the farm classes compared to what they were paying before 198 8, indeed the taxes in an overall sense have dropped. I know from my personal experience, and I have buildings and farmland, my share of taxes, or my tax bill, has reduced. Where there is intensive farm building use, that may not be the case, but where you have a fairly large land base and a sm all yard or small

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3470 outbuildings in your yard , whether they are grain storage, shops or whatever, in a general sense taxpayers are probably paying less now than they did four years ago, and that is pretty significant given what has been happening to costs. Ms. Wowchuk: Mr. Acting Deputy Chairperson , can we just go back to that portioning, please ?

You were talking about the adjustment, and what I was asking was, when the adjustment was made to portioning, certain sections, classifica tions, had a reduction in their portioning and farm had a reducti on, but I am l ooking for the-which classification got the largest reduction as compared to farmland? [inte�ection) There was change within the last year. Mr. Derkach: Mr. Acting Deputy Chairperson , the largest decrease was to Res. 2 and they went from 73.2 percent to 68 percent. Res. 1 went from 48.6 to 47 percent and Res. 3 went from 32.7 to 33 percent.

As the member knows, the Residential 2, which has been a big issue, was being portioned at 73 percent. This compared to a Res. 1 at 48 percent, so there needed to be some [inte�ection) Oh, farm, what did it go- Ms. Wowchuk: What is the farm one? Mr. Derkach: It is still 27 percent. The farm went from 27.1 down to 27 percent. Ms. Wowchuk: That is what I am trying to get at, Mr. Acting Deputy Chairperson, is the fact that Residential 2 had a drop in-what is it, 5 percent,

whereas farm residences had a drop of 0.1 percent, so in reality there is a shift on the amount of taxes back onto farm buildings. Mr. Derkach: The member may be arguing that they went down the least, but let us look at the figures. We are talking about Res. 1 at 47 percent, Res. 2 at 68 percent, Res. 3 at 33 percent and farm at 27 percent, so there is already a break there. Besides that, it was not the differences were picked up by such things that run in municipalities as railways and pipelines, so there was some shifting to them as well.

It was not as though there was a shift to farms at ail; there were other properties that picked up some of this as well, to try and get some equity in the system, because there is such a big gap between the Res. 2 and the Res. 3. Ms. Wowchuk: Just on that and the other

section of educational tax on farm land, we had a system brought in that was going to reduce education tax that farmers were going to pay, but now we see a shift in the portioning that sees farmers having a larger base to pick up, but they are also having to pick up special levy education tax on the farmland. In reality, instead of farmers paying less educational tax, they are now picking up a larger portion of education tax. Mr. Derkach: I would have to say that this government has lived by its commitment. We said when we came into power that we would reduce the education portion of tax on raw farmland .

I think that came to us at a cost of something lik e $22 million, if I am not mistaken. Now, that is $22 mil lion that came from general revenue to make up what we were compensating farmland for. Secondly, if you look at what the farm portion is now as compared to 19 89, it is an additional percentage point lower, which is the difference between 12 .5 and 11. 5 percent. In terms of the special levy, that is something that has to be left to the responsibility of local municipal and local government organizations.

You cannot simply say that it is government's fault that the municipality increases its budget and , therefore, puts more special levy on, or a school board increases its budget. I mean, those things are done by locally elected officials. You have a school board that is locally elected, you have a municipal council that is locally elected, and they are the people who set the special levies.

It is not the province. * (21 00) Now, you cannot expect the province to, first of all, take off $22 million of responsibility from far mland, decrease the share from 12 .5 to 11. 5 percent and then somehow wave a magic wand and expect municipalities to freeze their special levies. I mean, that real ly has to be their responsibility. If I tried or if any government tried to interfere with school boards in terms of their special levies and in municipalities, I can tell you that we would be criticized very severely by all of those organizations. Ms. Wowchuk: Is there a way that this can be dealt with?

This may be a hypothetical question, but I want to ask the minister. We have a commitment that education tax would stay on buildings rather than on land but, when it comes down to the special levy of schools, it goes on land and on the buildings, and the government says, well, that is not our responsibility, it is the local authority's responsibility.

3471 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 How can this be dealt with? Is it necessary to change the taxation form that separates the buildings? Is it necessary that government pass legislation that special levy only go on buildings, not on land? Has the government looked at this? How can we deal with this more fairly? Because land should not be taxed for education. We had that commitment from all members when Bill 79 was being passed, but now we have people saying, oh, well, it is not my responsibility, it is the local authority. How can this be dealt with, that taxes for education will be more fair?

Mr. Derkach: I would just like to give you an illustr ation of what the reality is. I understand that taxes are not easy to pay for anybody. Whether it is special levy or ESL, it Is still a tax that is paid to support our Institutions. I notice that the critic for Education is with us, and I am sure that if he suspected that we would be somehow moving to take some portion of support that goes to schools now off somebody like farm ers, then he would be asking the question, who is going to make the difference up?

H you look at what is being paid at the present time, and this Is total education taxes that are paid by various classes, you can see that Residential 1 , as an example, the total amount of taxes, the special levy collected is $1 20 million. From farm , it is about $22.7 million. H you look at commercial, the special levy there is $66 million. If you combine that with the ESL, you find that Residential 1 , as an example, pays $207 million; farm pays $22.7 million because they do not pay any ESL; and the commercial, or the other, pays $1 56 milli on.

That is a fairly substantive difference in what is being paid by the farm and by the others and the residential. So when the member asks how we can reduce the special levy, I do not know that we can, because that is something that is really up to the school boards and the municipalities to do. I do not know where else they are going to get their tax dollars if they do not get it from property classe s, because that is how we have traditionally supp orted education. We would have to redo the entire system of paying for education if we were to try and take it off farm land.

Somebody has to pay the bill and, up until this time, I think it has been viewed by not just this government, by all governments, that property taxation is the fairest and the best way-maybe not the best way-but it seems to be the fairest way in this province to support education costs. Ms. Wowchuk: I think the minister misunderstood me. I was not trying to say that the farmers should not pay their fair share of taxes for education. None of us as farm ers expect to get education for fr ee. What I am getting at is, is there a way that taxes for education can go onto farm buildings rather than farmland? Mr.

Derkach: Mr. Acting Deputy Chairperson, I would have to say that if you compare the amount of farmland that we have In the province to the amount of farm buildings that we have in the province, there is far more farmland than there are farm buildings in this pro vince.

Therefore , you would have to have a fairly significant shift from farmland onto the farm buildings, and the taxes that you would pay on those farm buildings would be so high that indeed some of the ones that are intensive farmers, that have, whether it is poultry barns or hog operations or intensive cattle operations, liv estock operations, just simply would not be able to exist and to pay their tax bills. I am not trying to set up an argument with the member here. I am just simply pointing out that is the dilemma that is faced, and I think that all governments have faced.

Down the road there may be a need to look at how we can possibly divide up that pie, but certainly we are not at that point at this time. Ms. Wowchuk: Considering the length of time that we have for these Estimates, I think we had better leave that argument for another time and perhaps a discussion that we might be able to work something out that would be something that can be a resolution to this in the future. I want to just touch on Bi1120 again, and that is the concern that farmers have with the amendments that are being made to 8111 20, that they will no longer have the right to appeal their assessment.

I know the minister has said time and time again, and he said it in his opening remarks, that farmers do have the right to appeal , but there is a feeling in the community-in fact, there was a court case that indicated that farmers did not have the right to appeal. H farmers do not have the right to appeal , why is the minister introducing this part of the legislation? Is he introducing it to take away the right of appeal from farmers in extreme circumstances, or is there a right to appeal under unusual circumstances? I

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3472 think that is a very important issue that is facing farmers right now, because if a homeowner has the right to appeal their property, I do not understand why farmers should not have a right as well if there are extenuating circumstances that have caused a decrease in their property value . I am not talking about general circumstances, cost prices that lower everybody's value, but things such as rail line abandonment or plant closures that affect the value of farmland, those kinds of things.

I think we have to have the protection in place for farmers to appeal . Mr. Derkach: Mr. Acting Deputy Chairperson , I guess in all of this, we have to look at an element of fairness. When you do that, you have to ensure that how one group or one individual or one property is treated, another property is going to be treated as fairly. When we introduced Bill 20, we made it very clear that we were not going to be taking any rights away from those who had those specific rights of appeal before. Bill 20 does not affect that.

As a farmer, if you were allo wed to appeal because of some external force near your property, whether it was a chemical spill or somebody putting up something that was affecting your property negatively in terms of its value, and it changed the value of your property, then you had the right to appeal that based on the 19 85 values. That has not been taken away. What cannot be done is that because market forces have changed in the farm community, you cannot appeal based on that, and that is exactly what Bill 20 prohibits a farmer from doing, because then there would not be any sense to having a reassessment year.

Basically, you would be reassessing constantly as the appeals came up. We have to protect that; that is the integrity of the bill, if you like, or assessment. * (21 10 ) All we are doing with Bill 20 is delaying the reassessment for one year. That is the most substantive change, and the rest of it stays as it was. So there is nothing taken away from a farm er to appeal the assessment of his land if there has been something happen to it physical ly or something has happened in a neighbouring property that has impacted on the value of his property. We have made that very clear.

We have talked to municipalities about it; we have talked to UMM, MAUM, Keystone Agricultural Producers. At first they were somewhat concerned that it, yes, in fact, it could, but I think they are satisfied now that Bill 20 does not impact on them in that way. The Acting Deputy Chairperson (Mr. Rose): To remind honourable members, before we proceed, that the purpose of Estimates is not to discuss bills that are under consideration. We appreciate the exchange of information and would appreciate it if the questioning could be confined to the line in front of us. Mr.

Gaudry: In regard to the reassessment, the question was ask ed, how have you informed the public out there in regard to the reassessment? Mr. Derkach: Good point. We have had several meetings, workshops, if you like, with client groups in terms of what the meaning of reas sessment is and what the delay of assessment is going to be. We have met with the major organizations at MAUM and UMM and Keystone. We have met at regional lev els as well.

We have also met, or tried to meet, with individuals who perhaps express an objection to Bill 20 or to reassessment, so we have tried to make ourselves as available as we possibly could. We have also written letters to the newspapers.

There was a letter from me, a letter to the editor, explaining reassessment to ensure that people who might have some questions would be able to contact us, and we have also sent letters out to all the municipalities to ensure that they too, if they do not understand something about rea ssessment, would be given every opportunity to contact us and we would make staff available to go over the impacts of reassessment. Mr. Gaudry: For example, in Hanover municipality, in and around the Steinbach area, there were farmers where their taxes have increased up to 200 percent.

What is the expla nation for such an increase on a quarter section? Mr. Derkach: I think the member asks a legitimate question in terms of clarific ation, but I would have to say that reassessment, as we understand it, and the staff have done the research on it, had no impact-or not a major impact on the increase in taxation in that municipality. In fact, the results of the increases could be traced back to several things, such as budget increases and also-1 think if you go back as far as 19 90-there was a fairly major municipal increase in taxation in the Hanover municipality. The Acting Deputy Chairperson (Mr.

Rose}: Item 5. Local Government Services Division (

b) Assessment: (1 ) Salaries $5, 19 5,900-pass;

(2) Other Expenditures $644 ,800-pass.

3473 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 Item 5.(

c) Municipal Advisory and Financial Services: (1 ) Salaries $1 ,074,700 . Ms. Wowchuk: Hit is all right with the minister, can we ask questions on that whole

section of Municipal Advisory and then pass it all, or do you want to start with Salaries? I want to ask questions on policing costs. [interjection] In the section, okay. Mr. Derkach: Mr. Acting Deputy Chairperson, if we follow the lines in or der, we will come to policing costs back in item 5.(c)(6). The Acting Deputy Chairperson (Mr. Rose): Municipal Advisory and Financial Services: 5.(c)(1 ) Salaries. Ms. Wowchuk: I guess I am one up ahead . Not Salaries, let Salaries go. Sorry. The Acting Deputy Chairperson (Mr. Rose): Item 5.(c)(1 ) Salaries $1 ,074,700-pass ;

(2) Other Expenditures $34 0,1 00. Ms. Wowchuk: Is this the

section that would cover off the conferences and the MAUM and those kinds of things? I am looking at the conference that is coming up this week in Brandon , the conference on Friday. Is this the

section that it would be covered under? Not in this section? Mr. Derkach: No, that

section was covered previously. The Manitoba Community Newspaper Association conference on Friday was cosponsored by the Department of Rural Devel opment, but we have covered that

section in the MAUM section. Ms. Wowchuk: I will come back under Salaries and ask you a few questions on that one. I want to ask some questions on this

section relati ng to local government districts. I had asked the minister previously and he had made brief comment earlier on his responsibility as it relates to LGDs versus municipalities, and the reason I asked the question is that municipalities make their own decisions on how they pay their staff, the amount they pay their staff, but when it comes to an LGD, the rates are set at provincial rates. I was always led to believe that LGDs were just an extended arm of government and that the minister had more authority to deal with LGDs than he does with municipalities.

Is that accurate information and are the LGDs less independent than municipalities ? Mr. Derkach: Mr. Acting Deputy Chairperson, there are several differences between LGDs and municipalities. First of all, with LGDs, the minister approves the by-laws, which is not the case for municipalities; secondly, with the LGDs, the minister also has to approve the funding expenditures for all LGDs, where that is not the case for municipalities.

Also, with regard to what we term resident administrators, who perform the similar functions of a secretary treasurer in an R.M., the minister also has the responsibility to appoint that individual who is the represe ntative of the Department of Rural Development. Ms. Wowchuk: H there are major expenditures being made by an LGD, does the LGD have the ability to spend that money without ministerial approval the same as a municipality or does the LGD have to come to the minister for approval? For example, if they were spending money out of reserves, would they have to get approval?

Is a plan then put in place by government to replace that money into reserves? • (21 20) Mr. Derkach: Mr. Acting Deputy Chairperson, it is true that before an LGD can access funds from a reserve, they have to have the approval of the min ister, and it is usually through a delegation-of-authority process that it has been done in the past but, yes, it is true that they have to seek approval from the minister for that. Now, I should also mention, that is true, that with municipalities, they also need a written approval from the minister to expend monies out of their reserve as well. Ms.

Wowchuk: Does the same apply to municipalities and LGDs for replacing their money back into reserve? Is it by law that they have to put that money back into reserves ? Mr. Derkach: Yes, there is a directive that is set forth by the minister where the regulations regarding replacement of reserves applies equally to municipalities and LGDs. Ms. Wowchuk: What time frame do they look at in putting that money back? If they are spending, say, $1 00,000, how do you figure out how many years they have to pay that money back, to recollect that?

I am trying to look at the amount of taxes that would have to be collected to pay it back. Mr. Derkach: Mr. Acting Deputy Chairperson, what we do as a department is try to undertake an assessment, if you like, of the particular jurisdiction and then work out the details of how that reserve will be replaced with that jurisdiction. Now, for some, it may be that it does not take as long a period of time

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3474 as it does for others, but that is basically something that is worked out between staff of the department and the local LGD. Ms. Wowchuk: Just on to another

section on Other Expenditures. It says in here, this

section includes increased funds of $1 26,000 to cover the cost of the Headingley initiative. What was the Headingley initiative? Is that the study the minister had said earlier that there was no money spent from this department on the Headingley separation at this point? What is this money for? Mr. Derkach: Once the R.M. of Headingley is set up, there are going to be certain expenditures that have to be incurred in order to get them incorporated and properly set up.

They are such things as: election expenditures, something the department is doing right now in terms of revising the election lists and the enumer ation, if you like; the office space, of course, there is a cost to that for the council chambers; there is purchase of office equipment, council indemnities and remuneration ; all of those kinds of things such as fees for joining organizations and legal fees, office expenditures such as maintenance and utilities, insurance, et cetera. All of those costs have been tabulated for Headingley and the best estimate we have is that it will cost us $1 26,000. Ms.

Wowchuk: Is it antici pated that will be recovered money, or is that money that the department will put up to have a new municipality established? Mr. Derkach: Mr. Acting Deputy Chairperson, I think the intent of this is that we will be able to recover a large portion of it, bt:t again, this is not something that we do every day. Therefore, it is going to take some negotiation and discussion with the new council once they are elected. It is our intention to recoup as much of that money as we possibly can. Ms. Wowchuk: If I could go back one step to the issue if LGDs.

The minister has had a very sensitive issue raised with him, and I have raised it with him with regard to LGDs, and that in particular is the LGD of Mountain and the vote they had to move their office. I know the minister has had several letters asking him to deal with this matter, and we all believe in the democratic process, so it is a difficult situation. I want to ask the minister, how is he responding to the many people who have written to him on this issue? Mr. Derkach: Mr. Acting Deputy Chairperso n, I have not had a great number of letters that have been written individually to me.

H I were facetious, I would say I will wait for the advice ofthe local MLA, but I will not say that. It is a sensitive issue. The LGD of Mountain held a refere ndum, if you like, on it, and it was decided through that process that there were more people who wanted the office located In Birch River, I believe it is. As you indicated, you believe in the democratic process, and it is something that we strongly believe in. How they got into the situation of a vote on it, I am not sure because that happened before I was the minister or during the transition period.

I guess the discussions were going on and then they had their vote, but it is not something that was brought to my attention that they were going in that direction. I do not know what I, as a minister, could do about it if the will of the people of that LGD is to go in a certain direction. It is the people of that LGD who, in essence, are going to have to live with that kind of decision. Ms. Wowchuk: I guess from this transpires other plans of people within the LGD, and I want to ask the minister a hypothetical question that could apply to any municipality.

If a municipality, if people within a municipality, were not happy with a decision and decided that they wanted to go it on their own, so to speak, then who makes that decision on redrawing boundaries. What is the process? Mr. Derkach: This once again becomes a fairly sensitive issue, but it is one that would be dealt with straight up.

I would say that if the appeal is made to me as minister, I would refer the matter to the quasi-judicial board that is set up, and that is the municipal board, who would then study the matter and make the decision on whether or not to allow such a thing to happen, but I might say this is once again something that does not happen very often. I am hoping it does not happen in this case, and I will be looking at working closely with the member for Swan River to ensure that we handle this in the most appropriate and the most logical way we can. Ms. Wowchuk: I guess it is very difficult.

It is my community, and it is an LGD that I served on for many years and one that I enjoyed working with. I would hate to see it separate or broken up but, because things have gotten to the point where they have, where they were allowed to take something like this to a vote, and I do not know whether there

3475 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 was any way that it could have been prevented, I look forward, as the minister has said, to working with the minister on trying to resolve this situation and coming up with the best possible solution that will work for the people of that area, but it is not an issue that is going to go away easily. Thera are soma very hard feelings about what has happened. I am not sure how we deal with It, but I think that the minister should be aware of what is happening.

There are possibilities of people appr oaching the minister on this matter of how than do the people on the south and of the constituency get the best service. Mr. Derkach: Just a comment, Mr. Acting Deputy Chairperson . I can appreciate the sensitivity of the issue. Indeed it is not one that I think is going to go away overnight, I agree, but indeed we have to allow the will of the people in the community to prevail. H we keep that as sort of the main principle, I think the process will unveil as it should. The Acting Deputy Chairperson (Mr. Rose): Item 5. (

c) Municipal Advisory and Financial Services:

(2) Other Expenditures $340 ,1 00-pass. Item 5.(c)

(3) Grants to Municipalities in Lieu of Taxes $34,1 86,200. Mr. Gaudry: Thera is an increase there. Are the grants to the municipalities details avai lable to the members? * (21 30) (Mr. Deputy Chairperson in the Chair) Mr. Derkach: The member asked for a fairly complic ated and detailed-we ll, not a complicated, but a very detailed list, and I think there is something in the neighbourhood of 7,000 or 8,000 properties that the department gives grants in lieu of taxes on. I am not sura that the member really wants that. Mr. Gaudry: Is it public information? Mr. Derkach: Mr.

Deputy Chairperson, this has never bean asked for in a public sensa, but It is a fairly complex way of dealing with it, because It is all done on a voucher system. So one would have to pull the vouchers, if you like, and than try to com pile a list and make it available in that form. But we have never bean asked as a department to make that kind of listing public. Ms. Wowchuk: Mr. Deputy Chairperson , is it all right to ask a question on taxation of leased land in this section? Is this the

section where we can deal with taxation? pntarjection) Yes, this is grants in lieu of taxes, but this particular line has no grants on it. Mr. Deputy Chairperson: Go ahead. Ms. Wowchuk: I would like to ask a question on taxation on Crown lands. Thera is an issue that has surfaced many times between municipalities and LGDs with regard to land being leased for residential, not agricultural land. They live on this land ; they do not pay agricultural tax, but the municipalities do not have the ability to enforce the collection of this tax on Crown land.

The people who live on this Crown land have the services provided by the community, by local authorities, but local governments do not have the ability to collect this tax. I know that it is an issue that has bean raised to me; it is an issue that I have tried to raise through a privata member's bill, but I cannot deal wi th it because It is dealing with money. Municipalities cannot collect the taxes. How can this issue be dealt with? Mr. Derkach: Mr.

Deputy Chairperson , this is a difficult issue because of the fact that Crown land is not something that is owned by the individual who lives on it or squats on It or whatever. There are, I guess, in the province soma squatters on Crown land; therefore, it makes it very difficult to try and collect taxes on property that the individual does not own. It is a dilem ma-agreed , but one that has not been resolved at this point in time.

I do not really know how we would even begin the move to try and resolve the issue, because there are so many different configurations: there is farm land, Crown land, leases; Northern Affairs has numerous ones. It is not a simple task of trying to simply tax Crown land, because Crown land is owned by the province. The individual who operates It or who uses it probably in some way, shape or form may pay some lease on It, but It is not a tax. Ms. Wowchuk: This is to do with Crown land residential tax arrears.

They have residences on Crown land; they are on a tax roll, but there is no way that municipalities can collect it. They do not have any teeth in the legisla tion, so to speak. Has the minister aver looked at this? Is there a way that the legislation can be amended to give some power to the municipalities? I know that this has been raised at MAUM conventions; there have been resolutions passed on it. It is an issue for many municipalities. Mr. Derkach: Mr. Deputy Chairpers on, this has been looked at, I think, not just in the time I have bean there, but for many, many months or years, if you like.

It is a very detailed and complex issue,

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3476 because it not only involves this department but involves departmen ts lik e Natural Resources, Crown lands. Therefore, different jurisdictions would have to be responsible for collecting these taxes. How you impose a tax on that and how you collect it is certainly a dilemma. I can truthfully say that, in the short time I have been In the department, we have not treated this as one of the priority items to this point in time. Indeed, it is one that may need some attention in the future. Mr. Deputy Chairperson: Item 5.(c)

(3) Grants to Municipalities in Lieu of Taxes $34,1 66,200. Mr. Gaudry: Yes, I asked the minister also, what was the increase of roughly $1 mil lion? Mr. Derkach: Mr. Deputy Chair person, that represents an increase of about 3 percent, which is the general increase on anticipated vouchers and that sort of thing. As the member knows, that new building that sits just down the street here, the new Remand Centre, is going to be one that is going to impact on this particular line, because there will be a grant in lieu of taxes for that facility, and the amount there will be something in the neighbourhood of $650,000.

It is items ofthat nature, new acquisition of buildings and that sort of thing that will drive the cost by that amount. Mr. Deputy Chairperson: A formal vote has been requested in the Chamber, so at this time I would ask the committee if we could recess and then come back after the vote. The committee is recessed until after the vote. *** The committee took recess at 9:38 p.m. After Recess The committee resumed at 10 :05 p.m . Mr. Deputy Chairperson: Order, please. Before recessing, the committee was dealing with 5.(

c) Municipal Advisory and Financial Services:

(3) Gr ants to Munici palities in Lieu of Taxes $34, 1 66,200-( pass). Mr. Gaudry: I will pass on that. Mr. Deputy Chairperson: 5.(c)

(4) Transit Grants $1 ,306,1 00. Mr. Gaudry: Can I have a detailed account of what consisted of Transit Grants and where they go? Mr. Derkach: Mr. Deputy Chairpers on, there are three communities in Manitoba who receive grants for bus operations or transit. They are Brandon, Rin Ron and Thompson. Additionally, there is a mobil ity-disadvantaged grant that is allo cated. That goes to various communities around the province. They use those grants for such things as the handivan in various communities. I guess last year we had a total of 42 communi ties who receiv ed grants under this system.

The maximum grant that can be received under this is $20, 000. It was im plemen ted by my colleague. Mr. Gaudry: The increase of roughly $60,000 would be a general increase also? Mr. Derkach: Yes, it is. It is a 2 percent increase and it is just a general increase . Mr. Gaudry: Mr. Deputy Chairpers on, you said mobi lit y gr ant for com mun ities other than Thompson, Flin Flon and Brandon. Could you explain what the mobility grant is? Mr. Derkach: That is the grant which is the mobil ity-disadvantaged grant for people who are mobility disadvantaged, if I can use that term.

The start-up grants, to a maximum of $6,000, are given out and then there is an operating grant which is given out to an equivalent of about 37.5 percent I believe it is, of the operating expenditures to a maximum of $20,000 annually. As ! Indicated, there were 42 communities last year that received that support. Mr.Gaudry: Mr. Deputy Chairperson , it goes direct to the community and not into a municipality, as such, where there would be more than one community involved. Mr. Derkach: It goes through a municipality.

All grants are made through municipaliti es, but in some cases it is not the municipality that operates the Handi-Transit program . It could be an organization within that municipality. Mr. Deputy Chairperson: The hour being after ten o'clock, what is the will of the committee? An Honourable Member: Continue. Mr. Depu ty Chair per son: The honourable member for Swan River then will carry on. Ms. Wowchuk: I want to get back to ask a couple of questions on the handivan transportation service.

I understand that this is a service provided to the communities very largely by volunteers, a lot of volunteer boards that keep these services in the community, and that there has been each year a

3477 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 conference held for the volunteer boards, but this year that conference has not been held. I want to ask the minister if that conference has been scheduled , if it has not been scheduled , why is that being elim inated? I understand in talking to the volunteers, that this was a good place for them to gather. It was an important function for them to share their experiences in running the handivans and they were qu ite dis appoi nted that the conference was not on. I want clarification. Has it been on or is it not on? Mr. Derkach: Mr.

Deputy Chairpers on, there will be a conference this fall. It is an annual conference. We have an advisory body that is made up of people who have an interest in mobility-disadvantaged persons, and indeed, they are the ones who co-ordinate, if you like, the conference along with staff from our department. I have met with Mr. Enns, who represents one of the groups that sits on the advisory committee, and I have also met on a couple of occasions with Mr.

Murphy, who is the chair of that committee. * (221 0) I have to say that I was very impressed with the attitude of these people towards trying to do things for themselves. They are indeed people who are very proactive, in a sense, in providing services for people who are mobility disadvanta ged. As I understand it, they are trying to shift some of the thrust of their conference to involve more people who are mobility disadvantaged, and I understand that is being worked on now. That conference will go on this fall . Ms.

Wowchuk: I am pl ea sed to hear that conference is going on, because as I say, there were people who were concerned that it was not. What would have caused the confusion, I want to ask the minister. Was the conference normally held in the spring and has been changed to the fall? Is that where the people got the impression that this was a service that was being cancelled to them? Mr. Derkach: Mr. Deputy Chairperson , it is true that the conference was usually held in the spring, but it was always the same format, I believe.

The chair of the advisory committee thought that by perhaps changing the emphasis a little bit on the conference and also the participation, notto exclude anybody, but to include more perhaps, that they would prefer to have that conference in the fall. What caused the confusion, I cannot say. Anything I would say would be speculation, so I do not know the answer to that at all. Ms. Wowchuk: Perhaps it might be a good idea then to contact some of the organizations, the handivan people, who are traditionally attending these conferences and let them know that the conference is going to be on in the fall.

There has been some concern that the service was not going to be provided. Mr. Derkach: Yes, that is possibly good advice. If there is some confusion there, we will make sure that people in the various interest or stakeholder groups will get that message. Mr. Deputy Chairperson: Item 5.(c)

(4) Transit Grants $1 ,306, 1 00-pass ;

(5) Centennial Grants $14, 800-pass . 5.(c)

(6) Police Services Grants $1 ,400 ,000. Ms. Wowchuk: Mr. Deputy Chairperson , we have had discussion on policing grants before, and the minister knows that we are disappointed that a decision has not been made to proceed with the recommendations that were made by a study group on changing. Municipalities and towns were concerned because they were setting their budgets and they expected that they were going to get a change after the budgets were set.

The minister has indicated that there is going to be another committee struck I believe to deal with this policing issue, and I guess I want to just ask the minister: When can we expect that this issue will be finally resolved and we will have a decision made? Mr. Derkach: Mr. Deputy Chairperson, this has already been addressed. As the member knows, in January I was handed a report that was done by a former RCMP Commissioner, I believe , or Director of Law Enforcement, Mr. Hill, in conjunction with members from UMM and MAUM. Were there any other stakeholder groups represented? No, there were not.

The recommendations were not one, there were several in the report. To try and make some sense out of it, we decided that we should probably strike a group of represe ntatives from the two associat ions, MAUM and UMM, plus the Department of Justice and ourselves who would work together as a team to make recommendations to us about the approach that should be taken on a long-term basis.

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MANITOBA 3478 That working group is being set up now by staff from my department. I think Mr. Roger Dennis is one of the key people in that in setting it up and is certainly working very proactively in setting up this comm ittee. They will then mak e some recommendations to us as to what would be an equitable way of paying for pol icing costs in both rural and urban municipalities outside the city of Winnipeg. That report is due at the end of August.

At that time I am hopeful that there will be some solid recommendations so that we can simply implement them as they are recommended to us but, again, that is not a guarantee, because there is still a lot of work to be done In that regard. Ms. Wowchuk: Mr. Deputy Chairperson , again on policing costs, I want to refer to a newspaper

article that was in today's paper I believe. I do not have the ar ticle with me, but it is related to volunteer policing in the community and calling for volunteers who will se rve as what appears to be the old-fashioned town constable that used to be in place . Is that something that people who are doing this study are looking at, or is that a recommendation that is going to be made? Is the Minister of Rural Development (Mr. Derka ch) in support of an idea where you would have volunteers handling a very important issue such as polici ng? Mr.Derkach: Mr.

Deputy Chairperson, that has not been brought to my attention specifically. Neither has that recommendation at this point in time. I am told that this could be an initiative of the RCMP, certainly not of Rural Development or of any body that I am familiar with. We will be watching it with interest I guess, but it is not something that I would move on without doing a great deal of study and thought and consultation on. Ms. Wowchuk: Mr. Deputy Chairperson, it gives me some satisfaction to know that is not something that this minister is looking at.

As I say, I feel that policing is just as important in the rural area, and in fact sometimes a much more necessary service than in some of the urban centres, and I do not believe that we should be looking at volunteers to handle those kinds of things for us. I look forward to the re por t and the recommendations that this committee comes up with and hope that we can resolve the whole policing-cost issue that has been facing us for some time now. Mr. Derkach: Mr. Deputy Chairperson , I might say I am looking forward to the support of the two opposition critics with regard to resolving this matter once and for all.

Mr. Deputy Chairperson: Item 5.(c)

(6) Police Services Grants $1 ,400,000;>ass. Item 5.(c)

(7) Municipal Support Grants $946,300 . Mr. Gaudry: Mr. Deputy Chairperson, could the minister give us the reason for the substantial de crease from last year? Offl oading to the municipalities? Mr. Derkach: I guess I go back to my old Education days to answer this one. When the Ed finance formula was implemen ted, there wer e 13 municipalities that had impacts of greater than 10 percent, I believe was the threshold. There was a decision made at that point in time that there would be a phase-in to allow those municipalities to ease a burden if you like in those municipalities.

There were 13 municipalities, I believe , that were receiving this grant. That grant has now expired and for that reason we see the support grants decreasing by that amount. Mr. Gaudry: Mr. Deputy Chairpe rson, if at that moment this money was required, what has happened since then? Was this for special programs in Education? •

(2220) Mr. Derkach: Mr. Deputy Chairperson , the money was put aside as phase-in money. In the first year we would phase in something lik e 50 percent of their costs; in the second year we would phase in something less, 25 percent, and then it would be phased out completely and municipalities would pick up the cost. It would give them basically three years to adjust their costs. Mr. Gaudry: So eventually we will see that there will be no mo re suppor t gr ants for thes e municipalities. Mr. Derkach: It is just that phase-in portion that was set aside that is going to be phased out. The other Municipal Support Grants will rema in. Mr. Deputy Chairperson: Item 5.(c)

(7) Municipal Support Grants $946,300;>ass . Item 5.(

d) Research and Systems:

(1) Salaries $856,200;>ass. Item 5.(d)

(2) Other Expenditures $1 ,978,200. Mr. Gaudry: The last it em, 5.(d), Mr. Deputy Chairperson , there is a substantial decrease In

3479 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 Other Expenditures and not as much in the Salaries . Could you explain the decr ea se in Other Expenditures? Mr. Derkach: As the member knows, over the period of four years, I believe it was, or three years, ther e was an associated cost with the implemen tation of a new computer system in Rural Development. That system has now completely been installed. I think it was initiated by my former colleague to begin with. It is now complete, and so that expenditure no ionger shows up in the line. Ms.

Wowchuk: I just want to ask briefly on the new agreement that has been signed with the Brandon- Mr. Deputy Chairperson: Order, please . Could I ask the honourable member to bring her mike forward. Ms. Wowchuk: The notes here say there has been a decrease in grants to Brandon Rural Development Institute. Can the minister tell us what has changed, where the funding is now going to come from for Brandon institute or what has happened there? Mr. Derkach: There is no reduction in the grants paid to the Rural Development Institute.

It is just an accounting procedure, I suppose, that has been put in place in terms of the fiscal year, which means that the line does not show the full amount. In essence, it is a commitment of the same amount of money that was committed to in the beginning, in the first three-year agreement. Ms. Wowchuk: Just a brief question on the Brandon institute-that comes under a later line in the budget, does it, or is this a point where I can ask a question? Mr. Derkach: Was there a question? Ms. Wowchuk: Yes, I have a question, but I am wondering whether it is okay to ask it at this time.

What is the total budget for the Brandon institute? Mr. Derkach: The grant to the RDI from the provincial government is $100,000 per year. It is a three-year agreement. They in tum receive money from private donations and other institutions for about the same amount on an annual basis. Ms. Wowchuk: I want to ask the minister if he feels the in vestment of $100 ,000 is a worthwh ile investment into research. What is the benefit of the Rural Development Institute or the work that they do for the Department of Rural Development?

What do they do for rural Manitobans that helps us enhance life or improve the quality of life, improve the quality or the opportunity for development? What are the benefits to the rural community for this investment? Mr. Derkach: Mr. Deputy Chairperson, I think this Rural Development Institute that was set up three years ago now has proved that it is a very successful institution for rural Manitoba. Several projects have been worked on, and I cannot list them at the present time, but there are some significant studies for towns that were done. I think there was one done for Neepawa.

There was another one done for the Village of Rossburn, if I am not mistaken, or one that was worked on in conjunction with the Village of Rossburn. What they do is assist rural communities to look at themselves to see where their strengths are. They will set up models for business opportunities in communities. Also, they look at not just the economic issues, but they will look at the social issues as well, the educational issues that may be prevalent in a community that need to be looked at. A lot of research goes into trying to find ways of revitalizing the rural economy in commun ities outside of the city. Ms.

Wowchuk: If the money comes from Rural Development to fund the Rural Development Institute, does the institute do work or research for other departme nts, or do they answer to the Department of Rural Development? I guess I want to know, do they look at things like child care in the rural area or quality of life or income level? Who are they responsible to? Is everything channelled through Rural Development? Who is responsible? Mr. Derkac h: They do not answer to the Department of Rural Development except through an annual report, I believe , that is going to come to us from them.

We have restructured the agreement this year. Under the stewardship of one of our staff, Marie Ellio tt, and in working with the Brandon Rural Development Institute, we were able to tighten up the agreement somewhat whereby it can give us some feedback on an annual basis. The Rural Development Institute does not answer to us. It does work for not only our department, but for other departments and communities. It is a matter of us giving them the grant and then looking at what kind of productive work they do for us. We do the analysis, we do the assessment, and then we go from there.

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3480 Ms. Wowchuk: It sounds to me like some of the work they do could tie in with round tables and those kinds of studies. (Mr. Jack Penner, Acting Deputy Chairperson , in the Chair) Do they do any work or are they directed by the department to work along with the visions for comm unities af ter they are present ed to government? Are there any services that they provide in that area? Mr. Derkach: The Rural Development Institute, through its research activities, puts together data, statistics that can be used by communities when they establish their round tables.

So in that sense, the instiMe itself does a fairly high level in technical research on a variety of fronts, whether they are health care, social issues, economic issues. In rural Manitoba, you could talk about water trends, agricultural Issues and municipal sewer and water. They can do all of the research for these communities, put the data together, and then allow communities to access that data when they make some decisions about the direction that they want to expand and grow in. The Acting Deputy Chairperson (Mr. Penner): Item 5.(d)

(2) Other Expenditures $1 ,978,200-pass . Resolution 118 : RESOLVED that there be granted to Her Majesty a sum not exceeding $48,01 3, 900 for Rural Development, Local Government Services Division, for the fiscal year ending the 31 st day of March, 19 93-pass. Item 6. Rural Economic Development Division (

a) Executive Administration: (1 ) Salaries $96,300- pass;

(2) Other Expenditures- Mr. Gaudry: Slow down, slow down, lots of time. There is an increase in salaries-and no increase in staff-by some $24,000. Can 1- Mr. Derkach: Mr. Acting Deputy Chairpers on, this is the

section that I went on at length by error before, so it is the same answer. The increase in salary here is the reclassification of the ADM position. The Acting Deputy Chairperson (Mr. Penner): Item 6.(a)

(2) Other Expenditures $24,000-pass. 6.(

b) Infrastructure: (1 ) Salaries $1 ,21 8,900- pass;

(2) Other Expenditures $290,900- *

(2230) Mr. Edward Connery (Portage Ia Prairie): Is this the area of Infrastructure where the assistance to southern Manitoba to do their water study-is this where the money came from for that? Mr. Derkach: Mr. Acting Deputy Chairperson, that money is allocated in the Expenditures Related to Capital , but if the member wants to ask some questions with regard to that, he may. Mr. Connery: It was through this particular department that the money was allocated for the study for the Pembina Valley task force? Mr.

Derka ch: The Depar tmen t of Rural Development extended such services as staffing and admi nistrative services, but there was no par ticular lump sum of money given from this department for the Pembina Valley study. (Mr. Deputy Chairperson in the Chair) Mr. Connery: Can the minister tell us the value of that assistance that was given? Mr. Derkach: Although I may be corrected, it appears that it would have been around that $50,000 mark in terms of what services were provided. Mr. Connery: Is that over and above-end I am trying to remember the figure. Was It $500,000 that was given?

What was the figure that was given? Natural Resources come into this also. Was there any cash grants, or just technical services staff and so forth that were given to the Pembina Valley project from your department? Mr. Derkach: Mr. Deputy Chairperson , from this department there were only the technical services that were provided to the Pembina Valley group. There was no cash given from this department. What was given from Natural Resources, I am afraid I could not tell you. Mr.

Connery: In assisting communities, and I do not have any difficulty with that-do not get me wrong-but in giving that sort oftechnical assistance, do you determine beforehand whether or not there is a supply of water avai lable to make use of those services once they are engineered? Mr. Derka ch: I am advised , Mr. Depu ty Chairperson, yes, that determi nation is made beforehand . Mr. Connery: Who made the determination? Mr. Derkach: With all the fireworks going on outside, Mr. Deputy Chairperson, it was hard to concentrate. To answer the question of my colleague , the Natural Resources staff.

The engineers and staff, I

3481 LEGISLATIVE ASSEMBLY OF MANITOBA May 19 , 19 92 guess, of the Department of Natural Resources would have made that evaluation and assured that there was an adequate supply of water available. Mr. Connery: The project is now being submitted to an environmen tal study to have the Clean Environment Commission determine whether or not there is adequate water in the Asslnlboine River to do that diversion. Of course, there is a lot of speculation from people along the Assiniboine River that there is not enough water to do it at this time.

When even the pumps to divert water into the Mill Creek, La Salle and Elm River were shutting off on low flows, and even PFRA were scram bling in the bottom of the Assinlboine trying to build up little dikes to force water to those particular pumping stations, we had some difficulty. As you know, coming from the Roblin-Russell area, the Shellmouth Is where the water is going to be held; yet, the Shellmouth was built as a flood protection unit, and so it creates some probl ems.

My concern Is going to that extent, did we put the cart before the horse In this particular case, or Is It normal to do the infrastructure and then to look for the source to assur e a source of water for It? A lot of money was spent. I guess what I would have thought maybe we would have determined the source and if there was adequate source available , then to have done the engineering studies and spent the money at that time.

If the Clean Environment Comm ission determines there Is not adequate water, then either they have to abandon the project and the costs that have been put into it, or they have to look for another source of water. Mr. Derkach: Mr. Deputy Chairperson, I guess I am being asked some questions that I do not have the answers to because they are not part of this department. The water studies in terms of the availabil ity or source of water was done by a different department so there is no way that I could determine whether or not the cart was put before the horse, to put it In my colleague's words.

I guess those questions could best be put to the Minister of Natural Resources (Mr. Enns) because there is no way that I would have that information. Mr. Connery: Will Rural Development be part of the funding of the project if it gets a green light? Mr. Derkach: Mr. Deputy Chairperson , I am told that if in fact the Clean Environment Commission were to approve that, then we would as a department be responsible for a third of the cost of the project. Mr. Connery: When you are tal king a third, you are tal king a third province, a third federal and a third municipal, is that the breakdown? Mr.

Derkach: Yes, that is correct. Mr. Connery: So I guess we are a year too soon because the project has not been approved. You would have to have approval of that money In a subsequent year through the Estimates process before money could be expended, or could it be done through cabinet and through Treasury Board ? Mr. Derkach: No, it would be done through the normal process and would have to be accommodated for in a given year. Mr. Connery: Has there been a commitment to the Pembina Valley Water Task Force to indeed go through with the project? Mr. Derkach: No, there has not. Ms.

Wowchuk: I just want to ask about another project and that is the Mafeking water project. I want to ask the minister what the status of that Is. I know work has been done and I beli eve the well was dug. At what point will it be that people of that community will have the long-awaited water in their homes? Mr. Derkach: Mr. Deputy Chairperson, I guess I am happy to report that the pipeline is ln. They will be doing the connections and working toward completion of the project. Ms. Wowchuk: I am happy to hear that as well. I am pleased to hear that project is near completion.

This was a long-awaited water supply and I am glad that it has come to fruition. •

(2240) Mr. Deputy Chairperson� Item 6.( b)

(2) Other Expenditures $290,900-pass. Item 6.(

c) Economic Development Services: (1 ) Salaries $704,900-pa ss;

(2) Other Expenditures $64,000. Mr. Gaudry: Is this where we ask questions on the Rural Development Bond Program? Mr. Derka ch: Mr. De puty Chai rperson, the questions for the Grow Bonds Program are probably more appropriately asked under

Section 8.(a). Ms. Wowchuk: This is the

section where we deal with Regional Development Corporations, am I correct? Mr. Derkach: Yes, it is. Ms. Wowchuk: Last year we saw a cut in support for Regional Development Corporations. We hear

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3482 this govern men t and this mi nis ter mak in g commitments that we want to see growth in the rural community. Earlier on he talked about the Regional Development Corporations playing a role in the results of the round tables and working along with communities. What has happened to the funding for the Regional Development Corporation? Has it stayed at the level that it was? Has there been an increase? Is there still the commitment to have Regional Development Corporations work with the communities as was the commitment by previous governments? Mr.

Derkach: I will not go so far to say, as was the case with previous governments, because I believe it was my colleague who was able to establish that funding to the Regional Development Corporations would be increased to the level of a 75/25 percent split,

whereas it was at a 70/30 percent split. Indeed, the sharing has been more in favour of the various organizations or development corporations. In essence, there has been a victory for Rural Development in tha t sense . Also, a new development corporation has been added, which is the Westman Economic Development Association, and again there was some $93,000 of grant money allocated for them. There was an increase this year. Ms. Wowchuk: I am glad to see that the increase is there and that we are going to have the support. As the previous minister just indicated, he did cut the funding and then did bring it back.

He redeemed himself by putting the services back for the rural communities. Mr. Derkach: Mr. Deputy Chairper son, ! have to be very thankful to my colleague who was in charge of this department before for seeing fit to argue very strongly for an increase in this area and also to maintain a fairer split for the Regional Development Corporations.

Whereas it was at 70/30, it is now at 75/25 percent. I guess I would have to say that the Regional Development Corporations were very, very happy with the grants this year. Mr. Connery: What was the previous, when you go back to previous one, two, three years in the total grants to the RDCs in absolute dollars? Mr. Derkach: In 19 90-91 $647 ,300; in 19 91- 92 $503,200; and in 19 92-93 $596,200. Mr. Connery: Unless I missed a figure, did I see a decrease or was there an increase each year? Reread those figures going back. Mr. Derkach: No, Mr. Deputy Chairperson, in 19 90-91 the grant total was $647 ,000.

It was reduced in 19 91 -92 to $503,200, and increased in 19 92-93 to $596,200. Mr. Connery: So we are still behind in the total funding even though we have had some increase in costs. What about the new ROC that has come on stream? Is there additional funding for it, or will that be taken out of the pot that the other RDCs were sharing? Mr. Derkach: Mr. Deputy Chairperson, there was $93,000 of new money put in for that ROC. Again, this department was not immune to some of the realities that had to be faced by other departments between the 19 91 and 199 2 year, and we saw a decrease.

This year we are able to maintain and also add the new ROC to it, so slowly we are starting to go the positive way, and I am hopeful that we can continue in the Mure. Mr. Connery: But there is less money and an extra ROC to be funded out of that money which means that some of the existing RDCs would have to be cut back in essence from the year before? Mr. Derkach: No, there are no RDCs that will be cut back one penny from what they had before. Mind you, that has to be sorted out with their budgets and that is done on an individual basis, but the $93,000 was new money that was added to it. Mr.

Connery: Does that go to the new ROC? Mr. Derkach: Yes, it does. Mr. Connery: So the other RDCs really yet then are receiving less money than they did three years ago in actual terms? Mr. Derkach: They are getting less money than they did three years ago, it is true. Mr. Connery: It seems to me it was four years ago that we promised to put large additional amounts of money into the RDCs and to create business offices in those RDCs. Has that thought been cast aside, or are we still looking at fulfilling that commitment? Mr. Derkach: Mr.

Deputy Chairperson , I have not been in the department all that long, but I can tell you one of the initiatives that I can see being undertaken in the department is a review of our delivery mechanisms in rural Manitoba. Because right now we do not only have RDCs out there, we have our Community Choices, our round tables, we have economic development boards ; we have Community Futures. All of these groups are trying

3483 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 to do many of the similar things and some of the responsibilities overlap. I think that RDCs, particularly in the Pembina Valley, the Central Plains area, have done a marvelous job in terms of the support that they have given the communities and the work that they have done in attracting businesses to the communities and to the province. I see those as very healthy, very strong bodies. We should not be trying to reinvent the wheel in other areas ; we simply should be learning from those who have had some success.

Certainly we intend to do that as a department to capture the successes of others and learn from their experiments, H you like, or some of their mistakes, and not dupl icate them and perhaps form closer links with them whereby we as a department are not duplicating some of the things that they have already done. That is all in the future, and, indeed, I intend to be working fairly close with all the RDCs, more particularly with those that have had some success. Again, the two that I had mentioned are certainly examples of very successful RDCs. Mr.

Connery: I do not recall if I got a clear answer on the business offices in the RDCs that was committed. I think it was three or four years ago and it was in the throne speech or budget speech three years ago to increase the funding to the RDCs and to incorporate business offices into them. Is that being permanently discarded? Mr. Derkach: Mr. Deputy Chairperson, I am not fam iliar with that aspect and that is something that I will look into, but there is no commitment at this point from this budget year to do that.

Once we have done the review of the delivery mechanisms, that may in fact be a very strong recom mendation. In doing this review , we will certainly be consulting with them to establish how we can better address some of the needs of our rural communities. •

(2250) Mr. Connery: It is my understanding that some of the criteria in the funding formula has been changed. Can the minister explain the dHferent criteria and-oh , yes, there is a change in the criteria. Mr. Derkach: Could I ask for clarifica tion? Is the member tal king about a change in the approach , a change in the funding formula criteria, or a change in how we allocate the money? Mr. Connery: It is to do with who would be putting money in as far as the 75/25 goes, and who would be part of that funding.

I think now it is just the R.M.s that are part of that funding, and it is going to make it virtually impossible for some of them to get the maximum government assistance and also the new one that was created. I think they have said openly already that they cannot meet the criteria that is set down in the funding formula. Mr. Derkach: Mr. Deputy Chair person, the intent of that change was to ensure that we are not supporting 75 percent of a picture where the other 25 percent is made up of other government-source funding.

It is for that reason that there was a change made with regard to allowing the monetary contributions of associate memberships, H you like. Now that is still in a discussion stage with the RDCs, and staff are working with RDCs in attempting to resolve it. Mr. Connery: There is the funding to the individual RDCs and then there is the funding to the overall association of RDCs, and it was under that particular funding where the managers got their pension plans and so forth. It is my understanding that was cut back and that there is no pension plan now for the managers of the RDCs. Am I correct in that assessment?

Mr. Derkach: The funding grant to the associations was curtailed two years ago, a year ago, last budget, and indeed there was funding used for building up a pension fund out of that which my understanding is-and I was not part of it-that is not what the association fund was set up for and so there are still discussions going on. As a matter of fact, I met with Mr. Meyer in Winkler, I beli eve it was, and I have received a letter from him now explaining what their function was. But for this year, there is no budgeted amountfor that grantthat was given to the association.

It is something that we are going to have to sit down and talk to the association about and see whether we can resolve the matter . Mr. Connery: Is it the departmenfs thoughts to use Rural Development officers in various communities in place of RDCs? We have Rural Economic Development officers in communities where there are also RDCs. What are the thoughts of the mi nister and the department on the ability of individual Rural Development officers to be as effective as the RDCs who encompass the various communities and, yes, there are a lot of elected

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MAN ITOBA 3484 people on it. There also are business people on, which bring the community thrust into it and bring the community involve ment, where when you have an individual from the ROC department being in a community such as Portage or Brandon or Dauphin, Swan River, in the past, when I, T and T has attempted to have development officers in a commu nity, it did not work. It was not the community invol vement, even though they were good people .

I know we had one in Portage, and the individual was an excellent person, but eventually I, T and T pulled that person back into Winnipeg. I guess the concern that I have is: Are these people going to be able to do the function, and should we be duplicating the function? Also, are these officers who we have in the communities economic developmen t officers, or are they community planning officers as you have, and I think her name is Jane Pickering, in Portage-is that the correct name?-who is a planning officer, not an economic development officer.

Now we see some thrust to have her become somewhat involved in the economic side. People who have grown up in their vocation as being planners do not immediately become economic development officers. It creates a proble m. I have been very involved with it in that sense in the Portage community and so know of some of the difficulties that that does present. Mr. Derkach: Mr. Deputy Chairperson, I guess there are some development corporations. I do not know if they are all that way, but there are some that are quite sensitive about their role in the community, and they feel it is their territory and their domain.

Our attitude is that the development of communities has to come from within and that it is a partnership approach that has to be used in the development of a comm unity. Our economic development officers who are in our Community Development offices, some of them, yes, of course, they are planners ; they are existing staff who were in the department before. They have undertaken new responsibilities, and we intend to spend some money and spend some time training them in the economic development field. It is not an impossibility. There is no school, per se, and there is no diploma program.

There is no degree program , I suppose, that I can recall that is specifically geared to graduate an expert development officer. There are a variety of schools where they have business mana gement programs and that sort of thing. So we are going to ensure that these people can access programs that will assist them to make the transition from their work that they did before to a new role. The department has an important stake in all of this. We have the tools, if you like, to be able to have those opportunities accessed.

We have our Grow Bonds office; we have our Comm unity Development offices; we have a RED I program . These community development officers who are scattered around the province-there are nine of them-are going to be very active in talking to the communities, working with municipalities, working with the RDCs, working with a variety of interest groups, working with private entrepreneurs, to assist them in, first of all, knowing what our programs are about, knowing how they can best utilize them and knowing where our strengths are in our various communities.

I indicated earlier that we are going to do a review of the delivery mechanisms that we have in the pr ovi nce so that we do no t dup lic ate , in communities, services that may be performed by others. But that review will be a fairly broad one, and it will include such things as RDCs in our Community Development offices and other delivery mechanisms that might be present from levels of government in a community. Mr. Connery: Well, I hear what the minister is saying, and if we have people, we try to train them.

The training of a person into an economic development officer from a planning position does not happen by taking a six-week, two-month or six-month course in economic development. It takes several years to develop a very key economic development person; as probably in being a planning person, it takes equally, so that it is very difficult just to interchange them back and forth.

As you know, I have been rather concerned with our rural economic development, our development in all Manitoba, job creation and business development in all of Manitoba, but in rural Manitoba, I have been extremely concerned that our thrust has kind of wandered . I have pressed very hard for our Rural Economic Dev el opmen t Initiatives, and they really have not been strong ones. *

(2300) I heard the memb er for Swan River (Ms. Wowchuk) ask: Is there really an infusion of real

3485 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 , 19 92 gov ernm ent mo ney in to rural ec onomic development, or is most of it coming out of the VL Ts and that sort of thing? I see what is happening in rural Manitoba. I see the decline of the numbers of people in rural Manitoba, and that is scary. If rural Manitoba continues to dwindle and Winnipeg continues to grow-as the minister, I think, knows, we are the only province with one city with over 60 percent of the population. This has not been healthy for Manitoba.

It is the only province that is in that position, and other provinces seem to have been able to develop several centres within their provinces which have made those provinces much healthier communities. I cannot be critical of this minister because he has just taken over the portf olio, so I am looking forward to try to impress upon the minister or to get some ideas as to the thrust that they are going.

If we do not make some very rapid improvements in job creation in rural Manitoba by indeed being a government initiative to encourage businesses to locate outside of the city of Winnipeg, then we are going to have a province with 80 percent of the people in the city of Winnipeg. How will we be able to keep people in rural Manitoba? As the population declines, the school syste m declines, the hospital system declines, all of the services that are required by people then go down hill. If we do not attack this very vigorously and have some real direct money put into it, then rural Manitoba will continue to decline.

Mr. Derkach: Mr. Deputy Chairperson, I guess much of what the member says may be true, and it has not been something that has evolved overnight. It is something that has taken place over the last 20 years. You cannot put a stop to something that has been there for a long time. We have implemented several initiatives that I think are extr emely positive and have been done fairly quickly. I can just name a few . First of all, if you look at what we did with Grow Bonds, in deed, tha t is an opp or tuni ty for communities to have a tool to use to invest in themselves.

If you look at the REDI program that was just announced very recently, you have a vehicle there to access a variety of things; first of all, to assist communities with infrastructure problems if that is a problem for an industry locating, for a community to be able to hire for small business a fairly inexpensive consultant, who is doing good work, to do a feasibility study and then also to access some dollars to help get it off the ground. You also have the youth business program, the Partners with Youth program. All of these have just recently come to the fore and have been announced recently.

We know that there are going to be some that may be more successful than others, but this is all an atte mpt to provide rural Manitobans with the tools to use to be able to, first of all, create jobs, secondly, to attract entrepr eneurs into their communities. If I could use the member's own community as an example, in the short time that I have been involved both in Education and in Rural Development, I can point to the community of Portage Ia Prairie as being a significant beneficiary of this government's thrust.

The member is a part of that and is a very important part of that, to try and ensure that a rural community thrives, grows and prospers. We continue to do that, and the suggestions that the member provides are excellent ones, because he identifies the fact that we have to be very careful about having one-city mentality in a province of a million people, where other centres keep dying and the one big centre keeps growing. That is a caution that I think he delivers very forcefu lly but very importantly. Much of what he says, yes, is true.

As he knows, I have not been in the portfolio for that great a length of time. I have been happy to announce the REDI program. There will be other initia tives that we hope to attach to the REDI program, and I know staff who are responsible are going to be work ing. I am not going to sit here and indicate in any way that we have the perfect solutions for everyth ing, but indeed I am prepared to work as hard as I can with members of the opposition , with my own colleagues, to ensure that we can provide the tools for communities to grow, to prosper and to become revitalized.

I would just like to conclude by thanking the member for some of his comments. Mr. Connery: I guess I asked too many questions in my earlier

preamble. I asked the question, how much of actual government general revenue money is going into rural Manitoba vis-a-vis the money collected out ofthe VL Ts, which is rural money going back into rural Manitoba? We see other initiatives which-and in some rural Manitoba, I see some also, but it would seem to me that rural Manitoba is funding on its own a large part of the economic development where maybe some extra money

May 19 , 19 92 LEGISLATIVE ASSEMBLY OF MANITOBA 3486 should be coming out of general revenues to be going into rural Manitoba. Mr. Derkach: Mr. Deputy Chairperson, there is a lot of money that goes into rural Manitoba from this department or from government. I think the budget line is somethi ng like $70 million for the department now. Of the Lotte ries money, there is something like $2.4 million that is going back into rural Manitoba that is actually generated from the VLTs.

We have made a commitment that 10 0 percent of our net revenues will be ret urned back to the rural communities through a variety of programs. Yes-1 cannot give you the exact breakdown of how much dollar value goes into rural Manitoba that is generated from other than rural Manitobans. I do not know if those figures are available, but certainly I can try to get them for you. I guess government approaches-and as the member knows its whole budgeting process through historical trends and also through where our emphasis and where our needs are, we have identified that our needs are in rural Manitoba.

It is for that reason that we put in programs like the VL Ts. They help in two ways : one, they help to generate some activity in our sagging hotel industry, or used-to-be-sagging hotel industry ; and secondly, they provide us some revenue to be able to give back to rural Manitobans for worthy initiatives. Mr. Deputy Chairperson: At this time, could I ask the honourable members to refr ain from moving into the Grow Bonds Program, which is under 8. Lotteries Funded Programs, and remain withi n the line that we are discussing at this time.

I understand the two are interconnected, but if we could relate more to the Economic Development Services, it might aid us when we get further on into it. The Grow Bonds will fall under another category. We are sti ll dealing with Economic Development Services:

(2) Other Expenditures $64,000. Mr. Connery: Hansard will show that I never me ntioned the Gr ow Bonds, Mr. Depu ty Chairperson. Nevertheless , it is pretty hard, when we are talking about Economic Development, to se parate them out because we are in an all-encompassing spot. I am not critical of the VLTs, but we have to acknowledge that it has helped the hotel industry which was sagging and is a major part of communities.

We also have to acknowledge that the dollars taken out from the VLTs are dollars that rural people are not going to spend in grocery store s or on hardware items, and so while we have moved it around, we also have taken away from some of the other economic sides of rural Manitoba. There are only so many dollars. You recycle those dollars and if they take them away from here, they are not going spent over there. I think we want to be clear that there is the need for new money into rural Manitoba. The minister mentioned the REDI program.

As the minister knows, I am not overly thrilled with the REDI program as has been presented, although he assures me that other initiatives will likely come fo rward. Is the REDI program now available to the public? Are all aspects, all the regulations and detail, is it out to the public? Has anybody taken up on it? Mr. Derka ch: Mr. Deputy Chairpers on, the Partners with Youth program is up and running. The other four programs are in the final stages of being approved.

In terms of the applications, we indicated to the communities that the applications would be done in May, and the manager of the RED I program is working to that end. * (231 0) Mr. Connery: The Partners with Youth one, I think, Mr. Deputy Chairperson-no, I am not opposed to it. I think the Infrastructure assistance program is one that could be very helpful to business in assistance in getting started , because the cost of getting sewer and wate r and especially three-phase power can be a major st umbling block to a small business getting est ablished.

But I do not see the RED I program, as has been presented to us, creating that many jobs and initiating that many new businesses or expansions of new businesses. Does the department have any forecasts of jobs that they expect to be created, and what development or what capital, not on the department side, but capital from individuals going out and developing in the way of processing or manufacturi ng? Did they do any projections on these when they developed the REDI program? Mr. Derkach: Mr. Deputy Chairperson, it is very difficult to predict exactly what the total number of jobs is that would be created.

The programs are not designed in that fa shion. They are designed for communities to apply for, whether it is infrastructure development-we have $2.4 million set aside which will be matched by another $2.4 million. That is $5 million of activity in a province for the creation of

3487 LEGISLATIVE ASSEMBLY OF MAN ITOBA May 19 ,19 92 jobs. That is what the REDI program is basically all about. Whether you put into the inf rastructu re, or whether it Is a feas ibility study program, or whethe r it is an MBA program, or whether it is the General Support program, they all, in one way or anothe r, will create some jobs. How many jobs are you going to create for the $2.4 million? I really cannot tell you that. We have not done that projection per se. The member Is somewhat critical of the program. That is fine.

I mean, we have not even got the applications out yet, so it is a pretty early analysis of the program . I am hopeful that we can prove the member wrong and that it will be a very successful program which we are looking at. It is not a program that I designed or any single Individual around this table designed. It was done In consultation with the stakeholders being the municip alities, the econom ic development community or units around the province. I know those who were not directly involved In it have stood to the side and have pouted a little In te rms of their criticism of it.

I am not refe rring to the member here; I am talking about those outside of this building. That is true, and I guess you will have that always, but I am hopeful that communities will really look at it In a positive sense. I have indicated this very clearly to the RDCs and to the municipalities, that when we develop new programs, I intend to consult with them to ensure that there Is going to be some input from them as to the kinds of programs they may want to have. As the member knows, I have already accepted a suggestion from my colleague and also from the ROC, and H that In fact is somet hing th

Document details

Collection	Manitoba — Debates (Hansard)
Citation	35-3-67b
Type	hansard
Volume / chapter	35th 3rd hansardpdf 67b.pdf
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	c5eeb3ad2ee18c877dcd36fa023a4d75dbe623d6

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