HANSARD

Printed and Published by Nova Scotia Hansard Reporting Services

Ms. Diana Whalen (Chairman)

Mr. Leonard Preyra (Vice-Chairman)

Mr. Clarrie MacKinnon

Ms. Becky Kent

Mr. Mat Whynott

Ms. Lenore Zann

Hon. Keith Colwell

Hon. Cecil Clarke

Mr. Chuck Porter

[Hon. Richard Hurlburt replaced Hon. Cecil Clarke for a portion of the meeting.]

Department of Transportation and Infrastructure Renewal

Mr. David Darrow, Deputy Minister

Ms. Jane Fraser, Executive Director of Strategic Planning & Infrastructure Planning

Mr. Doug Stewart, Chief Engineer, Highway Programs

Department of Service Nova Scotia and Municipal Relations

Mr. Nathan Gorall, Executive Director of Municipal Services

In Attendance:

Mrs. Darlene Henry

Legislative Committee Clerk

Ms. Sherri Mitchell

Legislative Committees Office

Mr. Terry Spicer

Assistant Auditor General

Mr. Neil Ferguson

Legislative Counsel

HALIFAX, WEDNESDAY, OCTOBER 28, 2009

STANDING COMMITTEE ON PUBLIC ACCOUNTS

9:00 A.M.

CHAIRMAN

Ms. Diana Whalen

VICE-CHAIRMAN

Mr. Leonard Preyra

MADAM CHAIRMAN: I'd like to call the meeting of the Public Accounts Committee to order, and we will begin by introducing ourselves.

[The committee members and witnesses introduced themselves.]

MADAM CHAIRMAN: Thank you very much. The way the committee will proceed is that we will have an opening statement from our guests, who are here today from Transportation and Infrastructure Renewal, and then we'll proceed with the first round of questions, which will be 20 minutes for each of the caucuses.

To begin, we'll have a brief opening statement that I know you have prepared. Thank you very much. Oh, just one other administrative thing - when we're doing the questioning, Legislative Television has asked that I have a chance to call each of the speakers, so the questions are going through the chairman and that they know who to focus on when they're filming. So if we could, that would be great.

I'd like to call on Ms. Fraser for the opening statement.

MS. JANE FRASER: Thank you very much. Good morning everyone. I'm pleased to be here today with my colleagues, Doug Stewart from Transportation and Infrastructure Renewal, and Nathan Gorall, from Service Nova Scotia and Municipal Relations, to provide information about infrastructure planning and stimulus investments in Nova Scotia.

I'd like to take a few moments to outline the current federal funding programs in Nova Scotia and to highlight some of the infrastructure activity. In its Spring 2007 budget the federal government announced a seven-year, $33 billion infrastructure plan known as the Building Canada Plan.

There are a variety of programs that are covered under the Building Canada Plan. There's the Base Funding Agreement, the Building Canada Fund, Gateways and Border Crossing Fund, the public-private partnership fund and, as well, gas tax from municipalities.

Some of those programs have designated funding allocations for Nova Scotia, and typically they're based on population. The Building Canada allocation is $235.7 million, and this includes funding from major infrastructure projects as well as the communities component funding for municipalities. Municipalities have received an additional $223.7 million under the gas tax extension, and the Base Funding Agreement was originally set at a seven-year program at $25 million per year for a total of $175 million. Both the Gateways and Border Crossing Fund and the P3 project funds are allocated based on an application basis. Provinces and territories do not receive a notional allocation. They're driven by application and merit.

In January of this year the federal government also announced additional stimulus funding under its Economic Action Plan. In this, under the stimulus fund, Nova Scotia was allocated $108 million; as well, the Base Funding Agreement, the option to accelerate that program, was included in the Economic Action Plan. Each of the infrastructure funding programs has its own criteria and list of eligible projects. Typically, they tend to be for core infrastructure projects.

For example, Nova Scotia has received funding from the Building Canada Fund for the national highway system and recreational facilities, as well as drinking water and waste water infrastructure. The Base Funding Agreement has funded bridges, non-core highways, broadband, and water utilities across the province. All programs also have specific timelines that have to be met, including the stimulus program, where projects must be substantially completed by March 31, 2011.

We have been submitting projects throughout the summer, and there have been several announcements including, as recently as earlier this month, the Halifax Library project, as well as a number of road projects and waste water.

Typically, eligible costs for federal-provincial projects are funded on a 50/50 basis. However, when there's partnership with municipalities, the cost sharing tends to be one-third, one-third, one-third. A project may fit under a variety of funding programs, so we will often have discussions with our federal counterparts about which program is the best fit for the project. This is usually followed by a formal application to a particular program seeking funding.

Some of the programs that I've mentioned are longer term, and these programs under the Building Canada Fund expire in 2013-14, while others are shorter and will be fully committed soon. For example, the stimulus projects must be completed by the end of fiscal 2011, so that funding is almost 100 per cent completed. While we attempt to meet program criteria in all of our submissions, some projects are not approved. When this happens, a project may need to be modified in some way in order to be approved, or we submit another project for consideration.

In the end, final approval for federal funding rests with the federal government. Nova Scotia has received significant federal funding under these programs, and we will continue to benefit. In addition to the lasting additions to important public infrastructure, there is no doubt that these projects have put hundreds of people to work throughout the province and, for example, the road-building sector is operating at near capacity. The highway capital budget is $325 million this year. That's the largest highway infrastructure investment in this province's history.

These are projects that have meant improvements in jobs to benefit communities from one end of the province to another. Another lasting contribution is the development of an infrastructure planning document, the long-term infrastructure plan, as part of the Building Canada agreement. While the infrastructure plan will discuss costs at a high level, it will not include detailed plans or budgets for specific projects. It will be a tool to help government departments and partners prioritize their infrastructure plans and projects and plan for future work. It will also provide a framework for managing and assessing Nova Scotia's public infrastructure needs in the long term. This comprehensive document is expected to be released in the new year.

In closing, I want to thank you for the opportunity to be here today, and we look forward to your questions.

MADAM CHAIRMAN: Thank you very much, Ms. Fraser. We will begin the questioning with the Liberal caucus, and it will be Mr. Gaudet for the first 20 minutes, followed by the Progressive Conservative caucus, followed by the NDP.

HON. WAYNE GAUDET: Let me begin by setting the stage. I think when we look back at November 2007, when this federal-provincial infrastructure program was rolled out, there were a lot of, I guess, high expectations that were created. We heard politicians talking about these shovel-ready projects, we heard the federal government talking about how this was going to create a lot of jobs and help stimulate our economy. We heard the former Premier talking about how this was going to be the largest infrastructure program in the history of our province, so of course expectations were created back in November 2007.

Surprisingly, Madam Chairman, I think it was May 1, 2009, before the federal government and the province started announcing funding for projects. So from November

2007 up to May 1, 2009, we can understand that people were not as excited as maybe they were earlier on. However, there have been many announcements since the federal minister for Nova Scotia, along with representatives here with our provincial government, started making formal announcements.

I want to basically begin with the cost of these infrastructure projects. I understand, as I believe Ms. Fraser indicated, the funding arrangements can vary. Normally it's a 50/50 split, where you only have the feds and the province involved, and then, of course, if there is a third partner involved it could be municipalities, universities, or other groups. That may vary.

So my first question to Ms. Fraser, am I correct that the funding arrangement may vary, or is there a pretty well straight formula that is being used in order to determine the funding arrangements for these infrastructure projects?

MS. FRASER: In all of the infrastructure funding agreements, there is an agreement that gets negotiated with the federal government and the provincial government, and that would set out the terms and conditions for funding. Typicially, what you will see in the contribution agreement or the framework agreement under the Building Canada Plan would be a statement that says that federal cost-sharing with projects that are funded with the province are done on a 50/50 basis. With municipalities it would be one-third federal, one-third provincial, and one-third municipal. If the private sector or a not-for-profit organization is involved in a project, then the maximum cost-sharing that the federal government will contribute is 25 per cent to the total eligible costs of the projects.

MR. GAUDET: Thank you. I'm trying to better understand the funding that was allocated under this agreement. That $634 million that was announced on November 2007, is that all federal funding?

MS. FRASER: Yes, that would be the federal contribution.

MR. GAUDET: Okay, I just want to be clear on that. Let me begin looking at the Building Canada Fund, Madam Chairman. As we heard through the Canada plan, there were a number of different initiatives that were targeted in different programs. I want to focus on the $235.6 million coming from the Building Canada Fund. Now, under that fund there are two components: the communities component and the major infrastructure component. So let me begin with the communities component.

We've heard that at least $37 million will be allocated to smaller-scale projects in communities with a population of less than 100,000 people.

[9:15 a.m.]

As I've indicated, back on May 1^st of this year the federal government, along with the province, started making formal announcements. My first question is, will you undertake to table a list of all the projects so far that have been announced that will receive funding from the communities component of the program?

MS. FRASER: Nathan Gorall would probably be best to answer that.

MR. NATHAN GORALL: I have the list available and I'm prepared to table it today with the group - and just to clarify on that piece, the full project, the full program, the $37 million is completely committed.

MR. GAUDET: Thank you. I appreciate the commitment made. Looking at the projects that have been pre-approved or approved so far that have been announced, are municipalities - have they been involved in all of those projects in allocating a percentage of the funding for those projects, or is this strictly between federal and provincial?

MR. GORALL: The communities component?

MR. GAUDET: Right.

MR. GORALL: Yes, the municipalities would forward to us a list of their priorities and we have a joint secretariat, funded by the federal and provincial governments, who would sort through those, do the analysis on them, and then make a recommendation to the federal and provincial governments - typically the number one and number two priorities for each municipality were selected.

MR. GAUDET: So the projects that have been approved are coming from the municipalities, it's not the province going in and working with the municipalities to basically put a list together? So these projects that have been approved have been coming directly from the municipalities themselves?

MR. GORALL: Yes, typically how we have done these programs in the past, and certainly with this one as well, is we'll put out what is called a call for applications. It is a very structured form and municipalities have an on-line system that they can access and actually send to us electronically their applications, and it's from that list that the federal and provincial governments would select.

MR. GAUDET: When I hear at least $37 million will be allocated to smaller-scale projects, has this funding been divided up throughout the seven years of the agreement or are there any restrictions in place on how much of the funding can be spent in different years of the agreement?

MR. GORALL: We have an annual target that we're provided from the Legislature, so what we'll do is we'll match up, based on the information that comes in the applications and follow-up conversations that we have with the project proponents about the likelihood of them starting and ending construction for each of those projects, then we'll just quite simply match up the available dollars each year through the life of the program, based on all of those projects. So some projects could be done in the first year, and some won't get done until the fifth year. We typically like to keep a year or two at the end for cleanup.

MR. GAUDET: So are there targets set for throughout the seven-year agreement on how much will be spent in year one or year two?

MR. GORALL: That's right. What we'll do is we'll make sure that the projects that we commit to in any given year don't exceed the amount of money that the Legislature gives us for that budget envelope. So $37 million, for example, will be spread over seven years. In the first couple of years, while projects are getting launched and a lot of the pre-work is being done, we would typically underspend in those years, a couple of million last year, a couple of million this year, and then in future years you'll see a top-heavy $10 million, $10 million, $10 million, I think in the final three years, something like that.

MR. GAUDET: Okay. Are there restrictions on where this communities component of federal funding can be spent?

MR. GORALL: There are eligible proponents and eligible criteria for the types of projects, the types of expenditures that are eligible and the types of projects that are eligible. Those are all outlined in the federal-provincial agreement.

MR. GAUDET: Okay. Let's move to the major infrastructure component. The feds have allocated $198 million to this component. We saw throughout the agreement that this component is basically to support investments in Cape Breton and Halifax. I recall back in April 2009, when our caucus met with the mayor of HRM along with staff, they had told us that they still had no Building Canada Fund agreement in place. So my first question is, does HRM and CBRM have agreements in place now?

MR. GORALL: For the Building Canada Fund?

MR. GAUDET: Right.

MR. GORALL: Yes, the federal government under their major infrastructure component of which HRM and CBRM are restricted to, because of their population size of being over 100,000 people, the $37 million was allocated by the federal government out of their MIC, the Major Infrastructure Component, for those two municipalities. The province notionally did an allocation based around population. Roughly speaking, 75 per cent of those

funds we would direct towards HRM projects and the balance would go towards CBRM projects.

Some of the federal money that has been allocated in Halifax as part of that 75 per cent of the $37 million is $12 million that went to the Mainland Common Project. The other piece of that - you would have seen the announcement quite recently for the library funding. So those two projects of the federal funds have been directed to HRM and there have been matching provincial funds.

MR. GAUDET: So the fact that there are agreements in place, of the funding, has been sorted out, that was my next question. If that $198 million had been decided, what percentage would HRM or CBRM receive? The fact that the library was announced last week, I'm just curious, have there been other projects that have received funding out of this major infrastructure component in CBRM and HRM outside the Common and the library?

MR. GORALL: No, that's correct. Those are the only two projects that have been announced. We've done stimulus funding outside of that, but out of MIC, the Building Canada Fund and MIC, those are the only two projects that we've supported.

MR. GAUDET: Does the province have a list of what the priorities are for HRM and CBRM? We've been hearing lots through the media, especially in the last two years. Do we have a priority list as far as HRM and CBRM of what top projects they are seeking funding for?

MR. GORALL: We do from HRM, in written form. From CBRM we've just had verbal conversations with officials there.

MR. GAUDET: Again, are there restrictions on how this funding, or where this funding, can be spent under this component?

MR. GORALL: Yes, again, those are outlined, the criteria is outlined in the agreement, of what types of projects they can spend the money on.

MR. GAUDET: Let's move to base funding. Under the agreement, Nova Scotia will receive $175 million in base funding. Madam Chairman, our province will receive an additional $25 million annually in base funding. So in seven years, $25 million a year, we're going to receive $175 million in total. I guess my first question is, I understand that this funding does not have to be used in the year it has been designated for, that the government can carry it forward to another year. Is that correct?

MR. GORALL: I'm going to pass it over to Ms. Fraser.

MADAM CHAIRMAN: Ms. Fraser.

MS. FRASER: Yes, that is correct. There's the option under the Base Funding Agreement to allow you to fund multi-year projects. A number of these projects are large projects that would take, obviously, more than one year to complete. So they would be approved in the year in which they're submitted on the capital plan with an understanding that they would be continued and completed in the next, you know, quite conceivably over a three-year time period.

MR. GAUDET: Has the province spent its base funding allocation for 2007-08, 2008-09 and for this fiscal year yet?

MS. FRASER: For 2007-08 and 2008-09, yes, we have and we've received funding from the federal government. In 2007-08 it was about $50.3 million worth of eligible projects that were completed and in 2008-09 we spent about, I believe it was $47 million on eligible program costs that were completed. In 2009-10, the current fiscal year, you may recall in my opening remarks I spoke about the option to have the funding for the base program accelerated under the federal Economic Action Plan so we have been looking up projects that we can fit in there to accelerate that program. The eligibility criteria under the Base Funding Agreement is such that projects in April 1, 2009 will be eligible and we will be cost sharing.

MR. GAUDET: Did I understand correctly that $50.3 million has already been allocated?

MS. FRASER: That was in total eligible project costs, so that would be federal and provincial costing as well in 2007-08.

MR. GAUDET: Is it possible to get a list of those projects that have been approved and received funding under the Base Funding Agreement?

MS. FRASER: Certainly.

MR. GAUDET: I'm wondering, are there restrictions on where this base funding can be spent ?

MS. FRASER: Once again, that would be similar to what Nathan was speaking about with project eligibility and various criteria, so there would be eligible costs that would be set out in the Base Funding Agreement, as well as the various types of projects which are eligible. It tends to be water, waste water, public transit, disaster mitigation, the highway system, projects of that nature.

MR. GAUDET: When I look at this current fiscal year, does the province have a priority list in terms of what projects they're looking for funding for under the base funding allocation?

MS. FRASER: Through the capital budgeting process there would have been a list that would be developed for the capital plan and we would be looking at all the funding agreements that are available from the federal government and looking to see what the best match is so there would be projects that would be included in the department's capital budget that would be cost shared with the federal government under the Base Funding Agreement.

MR. GAUDET: Okay, I'm looking for clarification. From the department's budget, the capital budget, they have a list of projects they're looking at funding for this current fiscal year. Out of that list, they're basically being picky and choosey with some of these projects for which they may be able to receive federal funding. I'm trying to understand how this game works.

MS. FRASER: Actually, Doug Stewart would probably be best to answer, the way the capital plan gets put together and the way that that works.

MADAM CHAIRMAN: Mr. Stewart.

MR. DOUG STEWART: This year was perhaps a little bit different than past years in regard to the base funding allocation in that with the introduction of federal stimulus many of the projects we would typically have put forward under base were eligible for stimulus. There has been a sorting out period of which projects are funded under which program, so our base program, our annual capital allocation, has not been submitted to the federal government yet.

The projects that ultimately do make up that program will be from ones that have been called in this year's capital program. If you're looking for what projects are on the list, it's basically the tenders that have been called and once we've sorted through with federal stimulus, we will be going to the federal government to say - in this case, they've given us the ability to accelerate base funding as part of their stimulus package so rather than the 25 per year we'll be looking to put forward more than that in terms of projects and so we'll be making that submission based on the program as it exists and was called this construction season.

MR. GAUDET: Okay, I fail to understand. So we have tenders basically being called for this current year, yet the negotiations with the federal government to determine which project may receive federal funding under the agreement, that's to be negotiated later on. No?

MR. STEWART: The agreement on base funding was signed two years ago and it sets out the criteria. At this point it's merely a matter of submitting a list to the federal government of projects to be funded under the terms of that agreement. We would have - because the capital program was so large this year - well in excess of $100 million worth of projects that would be eligible for that list but our claim, if you want to call it that, wouldn't be that big, so we would be taking a subset of those projects.

[9:30 a.m.]

MADAM CHAIRMAN: Mr. Gaudet, you have one minute.

MR. GAUDET: So what determines what projects? Unfortunately, there is not enough funding under the agreement to fund all the projects that are being considered. So what determines what projects will be receiving federal funding?

MR. STEWART: From the department perspective in regard to base funding projects, we have a TCA envelope which we manage our capital program to and we've assumed that we will get a certain recovery in dollar terms from the federal government for that program. We've basically instituted the capital program in terms of calling Project A, B, or C. We didn't go, A will be a federal project and B will not and C will not. We called those three projects knowing that all three of them would be eligible for the federal criteria, and then we will submit the list after the fact, I guess, in this case. Because there are projects which we may have considered to be a stimulus project, initially, then the federal government may or may not have been willing to accept that as a stimulus project, so we may then go back and submit it as a base project.

It is just because the introduction of the stimulus program has made that sloughing, if you wish - of which program a project belongs in - somewhat more difficult than in normal years. Typically, we would have that sorted out in the Spring, these are the ones that we're going to put forward to the feds, just a little off-cycle because of the stimulus program this year.

MADAM CHAIRMAN: Thank you, your time has elapsed for the Liberal caucus.

I will call on Mr. Porter for the Progressive Conservative caucus for 20 minutes.

MR. CHUCK PORTER: Thank you, Madam Chairman, and thanks to the folks from TIR this morning for being with us. Mr. Stewart, you reminded me of your minister there a few moments ago. There is so much information within there and I know your experience there can allow you to speak for probably hours on that.

MR. STEWART: That's a compliment.

MR. PORTER: Yes, it is indeed a compliment to your expertise there. I want to start off with something I'm sure that you're quite knowledgeable on as well, and Ms. Fraser and Mr. Stewart or whomever can answer this question, but it is with regard to - we've talked a lot about the different programs, funding, et cetera, and so on in the first 20 minutes. But what is our actual need in this province? I know that we're probably nowhere near the amount of money that we have to have. Do we have an idea how much we could spend if we had the money to spend, how far behind in projects we are?

MR. STEWART: Is your question in reference to highway projects or infrastructure in general?

MR. PORTER: Let's talk about highway projects first, and then we'll go to infrastructure. If they want to split them that would be great, actually.

MR. STEWART: In reference to highway projects, to bring the system up to what we would consider a reasonable level would be just over $4 billion over a 10-year time frame. So you would be spending $400-some million a year for 10 years out, to normalize things, if I could use that term.

MR. PORTER: What about your infrastructure side of things? Another $3 or $4 billion?

MR. STEWART: About the same, I think, if you added up all of the sewer and water and municipal stuff, yes.

MR. PORTER: That's something that I think the previous government was working on, or did an assessment back some time ago. I remember seeing numbers that were somewhat similar to that. I don't know if that has changed much over the last year or not; maybe it has and maybe it hasn't.

MR. STEWART: Maybe I'll let Ms. Fraser answer that.

MS. FRASER: One of the requirements under the Building Canada Plan was to undergo a long-term planning exercise, a long-term infrastructure plan. We've started that process, and looking at really the intent of that to get an understanding of the assets that we have and the condition that they are in. So we have worked with a broad representation of departments, looking at school boards, at hospitals, at long-term facilities, universities, municipal water, waste water projects.

So where we are currently is, as Mr. Stewart said, probably with the highway component, looking at a multi-year plan over the next 12 years. We're in the range of $8 to $10 billion worth of maintenance requirements.

MR. PORTER: Thank you. I know that generally speaking the public would not understand that TIR encompasses all of the infrastructure that you do as well. I think there is quite a lack of knowledge there. When it comes to it, a lot of people don't understand, they think about TIR and highways specifically. The other piece of that is, of course, there will never be enough, they will never be caught up, and they will never be exactly where they need to be.

I hear that almost daily from my constituents, and appreciating that and explaining to them that we're doing the best we can with the amount of money we have in the province and that we're considerably - and maybe "behind" is not the right word, but in need of much spending in the years ahead. They often ask, what's the plan to get that done? You try to explain some of these plans, they don't understand that. They don't understand the Building Canada Fund versus the gas tax versus this plan or that plan, they just know that there's a need and they wonder where the money is going to come from. They see themselves as taxpayers, which they are - they are one taxpayer, not three, although there are the three levels that they keep seeking these programs and dollars from and it never seems to work out and they always seem to feel like they're on the wrong end of that stick, for some reason, and I can appreciate that, too.

I want to stay with the highway side of things for a bit, but the gas tax you talked about for municipalities, how much is that coming into this province annually? That is question one.

MADAM CHAIRMAN: Mr. Gorall.

MR. GORALL: It escalated from the time it was initially announced in 2005, it ramped up to about $2 billion nationally a year. Our share of that, based on population, is around $55 million to $58 million.

MR. PORTER: And that goes to all municipalities? And just for clarity, how is that divided amongst the municipalities? I know we've heard about the population density, and we'll get back to that, but how is that divided?

MR. GORALL: We negotiated that - we being the province - negotiated that directly with the UNSM. Obviously HRM and CBRM were big players at that table at the time. It takes into account a formula based primarily on population, but it also includes essentially their core spending needs. So, for example, if you are a town, it would account for the fact that you end up paying a little bit more for infrastructure per capita than you would, for example, if you were a rural government.

MR. PORTER: Yet mostly towns are cash strapped in the province, if you look at the towns versus the rural municipal units, the towns seem to be in worse shape financially when it comes to where are they going to find the money to do the work and most aren't doing the work. It's rare to see some work going on. I know in the Town of Windsor, one of the areas that I represent this year, there's a considerable amount of spending going on - not that they have a whole lot of money - but I know from sitting on that council, as well, in previous years, that cash has been an ongoing issue with the towns. This formula - I know it was done through the UNSM - again, you come back to the people, they don't understand the formula piece. All they know is the roads are just as rough in rural Nova Scotia and in small towns,

as they are anywhere else. I know that they are not likely all that happy with the formula per se and how things are divided.

Is there more money planned to come from the gas tax in the years ahead, or will that funding in the national formula of the $2 billion - I think you said that it was divided based on population - do you see that changing at all by way of dollars? I know our population tends to stay rather stagnant, just shy of 1 million people or so in the province. Is it based on the total population or the driving population? I'm assuming it's the total population.

MR. GORALL: It is total population. We're finding across - at least in my conversations with colleagues in other departments - that the federal government is moving more and more toward a population-base distribution of funds. It is easier for them to defend, I think.

With respect to what we're hearing nationally, obviously that is subject to Parliament approving the funds each year, that they plan on making this a permanent transfer to municipalities from the federal government through Nova Scotia, the province.

I don't see that the numbers would change in the future, I think we're still locked in at - I would foresee us staying at $2 billion at least for the next four years. After that the program would be up for review. You should know that we are in the process of signing an extension to that for an additional four years worth and just putting in the Ts and Cs to lock that in between the federal and provincial governments.

MR. PORTER: So it's pretty fair to say then, we don't see much increase, at least in the next four years, in this figure coming to Nova Scotia. I know we're a smaller province so, at the same time, is the province thinking about a way to - I don't want to say adjust the formula but find a formula that will work and maybe a more fair - you know there are so many provinces in this country and anyone in this province would argue we should be getting a share, not based on population density because our needs are just as important as the needs in Quebec and Montreal or Ontario, rather, and Alberta, et cetera, even though they are bigger provinces there's a fairness issue there, I think, when it comes to negotiation.

We always seem to lose out here in the East because we're smaller and we tend to be forgotten, in my opinion. That's unfortunate for us, but what is the province's plan to negotiate more funds, regardless of the program?

MR. GORALL: I'm not aware of intent to negotiate a change in that. One of the things that, despite what I've mentioned about the trend toward population, one of the measures the federal government did take in the Building Canada Plan was to announce the $25 million base. That's $25 million that comes to Nova Scotia, but it's also the $25 million that goes to Quebec or Ontario, so that typically helps the smaller provinces by having a base amount.

This is more opinion than anything else - the $58 million that comes annually to municipalities sometimes gets lost in the project selections around stimulus funds or around community components. So we have $37 million that the federal government is going to give to municipalities over seven years in the communities component. This year they're going to give them another $58 million alone. That's something that, certainly in Service Nova Scotia and Municipal Relations, we try to remind municipal folks that there is a fair bit of discretionary funds that come in on an annual basis. Always could be more, for sure.

MR. PORTER: Absolutely. Always could be more. You mentioned the $25 million still going to Quebec, it's still the same thing when you look at it. I guess because we're smaller we have to accept that, and population-wise we have to accept that. There seems to be an awful lot of formulas and division based on population density, regardless of whether it's transportation or health care, as we hear in the last few days, for things like the vaccines and how that will be split. I can tell you, Nova Scotians aren't fond of that, in my opinion.

If you go to rural Nova Scotia, they're not fond of the formulas that we come up with to negotiate how things are divided, and I guess for the time being, we'll have to be accepting of how that is working, and that's okay.

You spoke of the dollars going to the municipal units and the programs. You talked about the 50/50, provincial-federal programs. Again, I want to stay with the municipal units for a few minutes - the one-third, one-third, one-third. A lot of these projects - there are all kinds of great projects out there, many have applications in to the feds and to the province, yet they don't have their one-third. Do we know what percentage of projects are being turned away because the municipal units generally don't have their share right now? Or, is there another plan to - I don't want to say carry them - but carry them through until they're able to secure financing or secure the dollars necessary to get them through these very good plans?

MR. GORALL: So far, when we have done calls for applications, every municipality has submitted applications for us. We hear a lot of what you're describing, and we know it's real because we also approve borrowing in our department, so we can see where their debt-loads are, still all within limits, including CBRM. We do hear this quite often, but nonetheless, at the end of the day when you're offering two-thirds funding for major infrastructure, there's a real need out there. That's too tempting to pass up, particularly when you marry that with what are historic lows in interest rates or borrowing costs for municipalities through the Municipal Finance Corporation.

MR. PORTER: Absolutely, and it is hard to pass up. Again, are you saying then that most are finding a way to find that money regardless of their debt ratio? I know, again, I'm going to come back to the towns versus the bigger municipal units. The towns are, again, fairly tight when it comes to that debt ratio. I honestly don't know how Windsor is doing it - maybe there's a planned increase to the tax rate yet that we haven't seen, whatever.

If I'm reading it right, you're saying the majority of them are going through, then? They're finding a way to get the cash?

MR. GORALL: They are, and again, I think it's prudent for them, in my opinion, it would be prudent for them to take advantage of the combination of interest rates and the two-thirds funding for critical infrastructure. I think so far the residents seem to be supportive of them putting those applications forward. We haven't seen a drop off in the applications.

Interestingly enough, there are a lot of applications that we just haven't been able to get to - we've had to say no to - because we've run out of provincial and federal funds.

MR. PORTER: That's a good thing. It's good that they are applying and you're right, with the interest rates where they're at and the two-thirds offer on the table, it's every town and every municipal unit, as we know from the provincial side of things, and looking after the roads, there's significant need.

You spoke about hundreds of people working and you were at capacity. I just missed part of that - it was the road working construction crews, hundreds of people. Do we know what the number of people and what capacity is?

[9:45 p.m.]

MR. STEWART: I couldn't give you a precise number, Mr. Porter. Certainly it would be in the 1,500 to 2,000 people work for the road building companies that we deal with. There would be considerably more than that who work in municipal sewer and water and that type of thing, so there are several thousand people directly employed by the companies and there are then, of course, a lot of spinoff jobs in relation to equipment suppliers, concrete pipe suppliers and that sort of thing. Internally we would have several hundred staff just doing the quality control and inspection, and the payment calculations and things for those projects.

So there are certainly several thousand people working, and in terms of the industry capacity on the road-building side, going into this week we had about 140,000 tons of asphalt still to lay - that's an awful lot for this point in time in the year. They have pretty well been flat out this year and certainly over the last number of years, as more monies come, contractors have made some investments in their plant and equipment and stuff to increase their capacity, but this year's program has pretty well tapped that - at this time anyway.

MR. PORTER: Thank you for that, and I realize there is a lot of work going on and that's great to see. I'm a bit concerned though, as you said, 140,000 tons of asphalt left to go. What happens if the weather unfortunately comes too early for the construction season on those projects? How does that impact the dollars being spent - does it just carry over dollar

for dollar into the next year, the next construction season, or are there penalties at certain points?

MR. STEWART: Two separate questions in there I guess. In regard to if Project A is not completed this year, what happens? We would carry that project over and complete it next year and it would sort of come off the top of next year's budget. The funds themselves don't carry, the project would. In regard to penalties - all the contracts that we call on the highway side have penalties, and it depends on the contract. It can be anywhere from $500 to $10,000 a day that we penalize the contractors for not getting work done by their completion date, so the contractors are usually pretty focused to complete things . . .

MR. PORTER: To get it done, of course.

MR. STEWART: . . . if at all possible.

MR. PORTER: Okay, great, and that takes me right into where I'm going. I know I only have a few minutes left here, but I want to get to a project going on currently in my area, in the Town of Windsor, the roundabout project at Exit 5A in Windsor. Now, there have been a lot of issues. People are appreciative, again, of the work getting done and, fortunately or unfortunately, depending on how you look at it, just on the other side of the highway in the Town of Windsor, the whole Wentworth Road is a mess and torn apart. So motorists are becoming somewhat frustrated, but anxiously awaiting the work to be completed.

Some of the problems we've been having in the past couple weeks or so with the roundabout construction is we're blocking businesses off. Pipelines are being broken and there doesn't seem to be a lot of co-operation between the contractor and what's going on with the local business. Some businesses are claiming they're down 65 per cent; some will claim if it doesn't pick up in the next week or two that's it, they're done. Again, I appreciate, as do the motorists, as do the businesses I'm sure, all the work that's being done, but one of the questions that has come from a number of the businesses is why aren't these folks working at night, question one, or why aren't they working 24/7 to get it done so the highway is open and things are back to normal, business picks back up and is where it should be - how does that work, Mr. Stewart, is that a negotiation through the tendering process or exactly how is that?

MR. STEWART: We don't set the contractor's schedule, Mr. Porter, we set a completion date and we put, as I say, penalties on the contractor if it's not completed by that date. But we leave it up to the contractors to determine their schedules and, as I mentioned, at this point this year there are about 140,000 tons to go down and contractors have been working Saturdays and Sundays.

We've very weather dependent, our business, so if it's a sunny Sunday then they're out there working. I'm sure their crews are not excited about that, but they're very conscious

of those penalties and we certainly, particularly in built-up areas like the Wentworth Road roundabout project, there are impacts on businesses and there's really not much you can do about that. If you're going to tear the road up, there's no way you cannot impact on the business and you just hope that it's as minimal as possible and certainly in that case we've had some discussions with the contractors around the particular issue you're referencing in terms of business access.

MR. PORTER: I appreciate that, thanks very much. So how do we get to that negotiation of potentially working at night then? Are you saying that the province will have nothing to do with that - the town or somebody with a business would have to go to the contractor, like Dexter, whoever is doing the work out there then, versus going to the province? I just want to take that point back clearly to my business folks, really.

MR. STEWART: There's no restriction on a contractor working at night under the Occupational Health and Safety Act, and in the Temporary Workplace Traffic Control Manual there are rules or regulations, whichever term you wish to use, around signing and visibility and all those types of things that a contractor has to follow. So within those parameters there's no restriction on working at night.

We certainly have quality issues in terms of - we have done a number of 100-Series Highway projects at night because of traffic volumes, particularly around metro and Highway 125 in Sydney. There's a very elaborate lighting scheme that goes along with that and we have, in certain cases, required a contractor to work at night. We pay a considerable premium for those projects, but if you take Highway 125 in Sydney which was done a number of years ago, which was required at night, there are 20,000 cars a day on a two-lane, two-way road and it's virtually impossible to do that work in the daytime, except on a Saturday or Sunday, so we have, on occasion, specified that, but it's not our normal practice. They are, however, free to work around that - whatever works best for them, subject to their completion dates.

MR. PORTER: Thanks very much. Thank you, Madam Chairman.

MADAM CHAIRMAN: Thank you, and the time has just about elapsed for the Progressive Conservative caucus, so I will turn the floor over to the NDP caucus. Mr. MacKinnon, if you would.

MR. CLARRIE MACKINNON: Thank you very much, Madam Chairman. I'm delighted to ask some questions this morning. From a personal perspective, I deal with one department periodically and I deal with another one daily, and I guess there's no guessing which one I deal with as a rural MLA on a daily basis.

We are very, very pleased to have this information coming forward this morning. One of the things I'd like to start with is - I know you've already sort of gone through this, but I'm wondering if you could recap in detail the criteria for the stimulus funding?

MADAM CHAIRMAN: Ms. Fraser.

MS. FRASER: Certainly every program and every funding agreement has eligibility criteria associated with it, and that is part of the funding agreement. Under the stimulus agreement, because the focus is really on getting projects underway quickly and getting them completed by March 31, 2011, the criteria has been broadened somewhat. So, for example, on the highways that are eligible for funding, that would be all local highways, all national highway systems, bridges, structures - essentially everything that is part of a highway system.

There is also short sea shipping, there are ports that are eligible, disaster mitigation, water, wastewater projects, and there's brownfield remediation - essentially everything that would be core infrastructure. We do have a list of the eligibility criteria.

Under the municipal jurisdiction, there would be public transit, sewer systems, things of that nature. Generally what is not eligible would be provincial buildings - that would be, I guess, the best way to categorize what is not eligible, as well as ports for private sector.

MR. MACKINNON: Thank you very much. When we indicate that projects should be substantially completed by March 2011, is that fixed, or what do we mean by "substantially" - what kind of percentage has to be done?

MS. FRASER: The definition in the agreement is that it has to be ready for use and completed. So it would be, under the Builders' Lien Act I think it is 95 per cent completed. The federal government has been fairly clear, very clear, on the fact that this is a firm deadline and, as a result, typically what you will see as projects going forward would be repaving rehabilitation under the stimulus program as opposed to the bigger, larger capital investments that you would see maybe under the major infrastructure component or under the Base Funding Agreement.

MR. MACKINNON: I understand that most of the stimulus funding has been committed - is it all committed, or what percentage, a very high percentage?

MADAM CHAIRMAN: Ms. Fraser.

MS. FRASER: Of the $108 million allocated to Nova Scotia, we have projects that have been approved and announced of $104 million, so we're at 96 per cent committed.

MR. MACKINNON: Thank you very much. I'm wondering about timelines - when did you receive approval for projects? I understand projects were coming in over the summer

months or throughout the summer months, but could you sort of give us a little timeline involved with receipt of projects and from there forward?

MS. FRASER: Certainly. With the Building Canada Plan, the plan that was announced in 2007, there would have been projects approved previous to that in both 2007-08 and 2008-09. But more specifically for the stimulus program, we were working on a list of projects in, I guess, late winter, early Spring and the first announcement of the funding under the stimulus plan, I believe, was around the end of April. The agreement was signed on May 6^th, I believe, and included in that was a schedule of projects for parks, a Bluenose II retrofit, and then a number of highway projects.

During the summer we were working with our colleagues at Infrastructure Canada at Transport Canada to submit projects and periodically what you'll see would be announcements of projects, so it would be an ongoing process.

MR. MACKINNON: I'm wondering if you could elaborate on the kinds of projects because certainly we know the spread is fairly great. I understand even the Bluenose is involved in the projects, so could you spend just a couple of moments giving us a picture of the projects?

MS. FRASER: Certainly. Within the $104 million that has been committed, there's a range of both provincial projects as well as municipal projects. On the municipal side there has been, I think, about $22 million committed under stimulus for projects in CBRM and HRM, as well as other municipalities across the province, so in that you'll see a mix of water, waste water, some improvements to municipal buildings, the Sheet Harbour sidewalk projects, some main street rehabilitation projects, things of that nature.

On the provincial side of things we have a number of park improvements that have been approved, so there will be some improvements to the park infrastructure: construction of new washroom facilities, shower facilities, campsite improvements in four of our provincial parks. There's also the Bluenose II retrofit project, which is a $14.2 million project, which is cost shared equally with the federal government, which will see essentially a full rebuild of the Bluenose II and that will coincide with its 100^th Anniversary, I believe.

The balance of the projects would be directed at highway projects that would be all across the province and it would be a mix of some secondary roads, some paving on the 100-Series Highways, some bridge structures, so there are a number of projects that have been approved all across the province.

MR. MACKINNON: Certainly we know of the 50-50 cost sharing when it's federal-provincial. I think that the member for Hants West expressed one of the concerns that I have had and I think the response has been that most municipal units have been able to find the monies somewhere when we're dealing with one-third, one-third, one-third and I've always

had a concern about some of the poorer municipal units not being able to cough up or come up with the one-third that is required.

Have you run into many situations that there just isn't the one-third there? I guess your answer already to the member for Hants West has been that with the cost of borrowing and so on, most of them are coming up with the money. Is that correct?

MADAM CHAIRMAN: Mr. Gorall.

MR. GORALL: Yes, typically that's what we found, almost consistently across the board. The one example that we've had recently before this fund came out wouldn't surprise anybody in this room, the Town of Canso. We had a challenge with the Town of Canso and between federal and provincial governments, primarily provincial, we came up with a greater than one-third share, in part because of their financial situation and partly because of the specific need to build a water treatment plant there.

[10:00 a.m.]

Other than that, earlier on when we were beginning this process, we had some municipalities, those that are a little bit better off, suggest to us if the province couldn't come up with its one-third, then they would be prepared to at least pay two-thirds so they didn't lose the one-third federal funds. So I think the challenge of finding the dollars is there for all three levels of government, certainly ours as well. We just make it a priority and I think that's what the municipal governments are doing.

MR. MACKINNON: Near and dear to my heart are sort of the highway projects and I'm wondering if you can give us a little flavour of the major highway projects that are currently underway, supported by federal funding.

MR. STEWART: Any particular program, Mr. MacKinnon?

MR. MACKINNON: I'm looking at the major projects and some detail on Highway No. 101, Highway No. 104, that kind of scenario.

MR. STEWART: Certainly. There are a number of federal cost-shared agreements related to highway construction and other things but Highway No. 101, some of them go back quite a ways. Previous to the February 2007 federal announcement, there are two programs of that nature - CSIF, which is Canada Strategic Infrastructure Fund I and II, and those agreements date from the early 2000s. On the CSIF I projects that are underway, there's a section just outside New Glasgow, from New Glasgow to Pine Tree Road, which is ready for paving and you'll be pleased to note that that tender should appear in the paper in the next few weeks.

MR. MACKINNON: I'm glad to hear that.

MR. STEWART: Mr. Porter has left but there's a similar project from Ellershouse to St. Croix and the contract for paving of that should appear in the paper in the next few weeks. Those are both CSIF I projects and that kind of wraps up that particular agreement. It was about a $60 million agreement at the time.

CSIF II has two portions which are underway. There's the second half of the New Glasgow project which goes from Pine Tree Road to the other side of Sutherlands River and the grading work that was carried out there, the new road construction work that was carried out this year was actually funded under that agreement. There's also a section of Highway 125 in Cape Breton that goes from Balls Creek to Coxheath, if memory serves me correctly, and the construction work for that was carried out this year and the paving contract for that will appear shortly. Also under that CSIF I agreement there's an interchange in Hectanooga which will be paved and opened next year and that was the last of three interchanges going down Highway No. 101. So those are older agreements that are wrapping up.

In terms of the new slate of programs announced in February 2007, there were announcements made for both Phases I and II of the Antigonish Bypass although the actual agreement has not been signed yet. The i-dotting and t-crossing is going on but those were announced and there was a federal commitment for those projects. There were the passing lanes on Highway No. 101 and that's a three-phase project. The first phase of that is just wrapping up for this year and there are two other phases - one for each of the next couple of years. That's funded under the Building Canada Fund.

There are some bridge announcements and there will be a tender out in the next little while for a bridge in Milford replacing the existing structure there which is funded under those agreements. Under the base funding, in addition to a number of repaving projects over the years, there was some work done outside of New Glasgow in the last couple of years. Those were both funded under base paving on Highway No. 104 and there was some paving down on Highway No. 101 and Highway No. 103 that was covered under the base agreement. There's also the Larry Uteck interchange outside of Bedford West, a very major project in the $22 million to $23 million range. That's funded out of base and it's funded in co-operation with HRM.

That's the base program. And then stimulus, in addition to some highway, there's some repaving, 100-Series repaving projects done on Highway Nos. 105, 104, 102, as well as some secondary road projects. The biggest stimulus project currently underway would be - the two biggest ones would be the Fairview Overpass, which is a stimulus project, and Margeson Drive interchange, or Beaver Bank West, whatever you want to call it, just on Highway No. 101. Those are also stimulus projects. So there's quite a bit of activity. There would be close to about $180 million worth of work being done this fiscal year on a cost-shared basis, utilizing those various federal programs.

MR. MACKINNON: Certainly, the work from New Glasgow to Sutherland's River is very, very important to my constituency, as it runs through that constituency.

One of the questions that I would like to put forward is, how long does it take to build or twin a highway? I know there are so many factors involved from environmental assessments, purchase of land and so on.

MR. STEWART: It takes a very, very long time. (Laughter) If you're lucky, you can do it for three or four years on some projects and Antigonish is probably the classic one, which is about 15 or 16 years from inception of the concept to actually getting construction started. That relates to a number of issues. You have a route location process, you decide with the concept that we want to go from Point A to Point C, and there is a planning exercise where you're attempting to sort out - from an engineering perspective - what's the best alignment to go between those two places.

We then go through an open house process, a public consultation process, which is useful to the public in terms of understanding what we're proposing to do and very useful for us in terms of there are always things that we don't know about. I mean we have local people and local staff involved in these projects but there are always things brought to our attention at open houses, so you have to go back and rework that functional design to take into account issues that come up. In the case of Antigonish, there was a very lengthy discussion period, shall I say, involving three different routes - red route, blue route and brown route or something - and they eventually came up with the route. But there was an awful lot of consultation and, shall I say, community interest in that particular project.

So when you've kind of ironed that bit out, you then go into an environmental assessment. We don't have any exemptions from the environmental rules that everybody has to follow so we'll hire consultants to go and do a screening of the alignment and we look for, there could be rare plants or animals or issues of that. The Department of Environment is very interested in preserving and protecting wetlands, and those water bodies and protected ecosystems get picked out and shown and how the route impacts on those. In some cases, we'll adjust the route to avoid those things and in other cases, we will work out in consultation with provincial Environment and federal Fisheries. On compensation projects, we do a 3 to 1 to 7 to 1 ratio, and we will recreate new marsh to replace the marsh that we're destroying for the road or that type of thing. So that's typically a year or two years.

Once you've got all of that sorted out, then you have to buy property and that can be a lengthy process, particularly in a place like Antigonish where you have certainly on the western end of that project, you are close to the developed area and there are a large number of properties and some of them could be quite expensive. So we have to go through that process. While that's on, you're doing the detailed design, the function design tells you to go from Point A to Point B but in the detailed design, you start looking at slopes and soil conditions and clearance understructure and that type of thing. So that process takes a year

or so, at best. Then you'll estimate those projects, staff will go out and survey it and determine quantities and then you get to the tendering process and then you actually tender.

Tendering brings it's own little source of frustrations. You've got the contractor there working and you run across a fibre optics line that you didn't know was there or that type of thing, and things kind of quiet down for a little while, you sort out how you deal with that. So it can be a very lengthy and complicated process, particularly for the large projects.

MR. MACKINNON: I was going to ask about what is involved in an environmental assessment but I think you've already answered that in the previous response that you just gave. I think you also indicated an actual time frame for an environmental assessment as well. Did you say a year or two years sometimes?

MR. STEWART: Depending on the route and the length and the complexity, yes. It can easily take, we would assume normally, about a year to do an environmental assessment but on the causeway at Windsor, for example, it is one that certainly has taken longer than that. It is a more complicated one, so it is not unusual for two or two and a half years in some cases. Highway 113 is another one that took a long time and after submitting an initial report we were asked to provide an additional report, so that adds time as well. So it could be a very lengthy process.

MR. MACKINNON: So, when you're twinning a highway, when you're building a highway, what is the cost per kilometre?

MR. STEWART: Currently it's running $3 million to $3.5 million a kilometre. It is slightly cheaper to twin than to build a brand new one. That's just for the actual, what I would call, subgrade; you would probably call it roadbed and asphalt, and then you would have bridges on top of that. So, for example, the Antigonish project is about 16 kilometres of four lanes, but that will be north of $150 million when it's all said and done because there are some very major structures in there, in Lower South River and West River.

If you look at the project you're familiar with in your part of the world, the bridge over Sutherlands River is a very major structure and it wouldn't be at all surprising to spend $10 million for just that one structure. So $3 million to $3.5 million per two-lane kilometre, or per centre-line kilometre, which is two lanes and then structures on top. It is very, very expensive.

MR. MACKINNON: So some of the things that you're involved with are thwarted by the seasons as well. What's your construction seasons?

MR. STEWART: Yes, we're very much - our lives are governed by the weather. We have snow season then we have pothole season then we have gravel road season then we have dust seasons. (Laughter)

MR. MACKINNON: The pothole one is a long season sometimes.

MR. STEWART: We like to think it's a little shorter but perhaps in some cases it is long, yes. Certainly the summer construction season really runs from the long weekend in May until about the end of October. Once you get into November, temperatures and moisture get such that it's difficult to get a lot done. In the summertime, a contractor can work a 12- or 13-hour day without any trouble. When you get into late Fall, he's more in the 8 or 9 hours amount of time there. Am I out of time, Madam Chair?

MADAM CHAIRMAN: Yes, thank you. The time has expired for the NDP caucus. Just before we go to our second round of questioning, I'd like to make note for the record that Mr. Hurlburt, the MLA for Yarmouth, has joined us, replacing Mr. Clarke.

Now we will have 12-minute sessions for questions, beginning with the Liberal caucus, Mr. Gaudet.

MR. GAUDET: Thank you, Madam Chair. To Ms. Fraser, you indicated earlier that the province had received $108 million under the stimulus agreements. That was strictly all federal funding, matched by the province - $104 million has already been spent. Is that matched dollars?

MS. FRASER: Yes, it would be, so the $104 million that has been committed by the federal government would be matched by the province. Within that, there would also be $22 million worth of municipal contributions for municipal projects. So in total, the total eligible costs for projects is around the $220 million to $225 million mark.

MR. GAUDET: Okay. Two questions: When was that agreement signed? I understood earlier that it was May 6^th - was it this year or last year?

MS. FRASER: It was May 6, 2009.

MR. GAUDET: Okay, 2009. Would it be possible for you to table a list of the projects that have received funding from under this agreement?

MS. FRASER: Certainly, we have - I believe they were in the package that was submitted and they would be on the various schedules but we can certainly give you a comprehensive list of all the projects that have been approved.

MR. GAUDET: Thank you. I want to begin this round with - I guess since the $634 million agreement was signed back in November 2007, many questions have been raised and I am just going to share a few of those. How is the government going to distribute this funding across the province? Will all regions be treated fairly? Is there a set amount

designated for all regions of the province? I'm just looking for maybe a general overview of how the government is planning to allocate this funding across the province.

[10:15 a.m.]

MS. FRASER: Certainly within some of the Building Canada Plan programs there have been specific allocations set aside for municipal units. So, for example, under the Building Canada Fund - the $235 million program - there was $37 million set aside for the communities component and those are projects that are for municipalities whose population is 100,000 and lower. Certainly Mr. Gorall has spoken about the way that those projects have been distributed.

HRM and CBRM are the two municipal units that have a population of greater than 100,000 people receiving or eligible for having projects funded under the major infrastructure component. For provincial projects and projects that the province owns the assets, that would be part of the capital planning process. The Department of Transportation and Infrastructure Renewal would work as the lead, would work closely with our colleagues in Treasury Board and work with other departments to see which projects are on the capital planning list and then looking at that, which projects would fit the eligibility criteria. Certainly on the highway system you would have a capital plan that would be set out based on criteria and based on priority and work within those lists under that.

Certainly Mr. Stewart can correct me if I'm wrong, but my understanding is that the idea is to have work spread out across the province, to make sure that the contractors are working all across the province, and to make sure that there is industry capacity maintained throughout the province and there's work going on. There's certainly enough need across the province.

Under the Base Funding Agreement, that is the equal jurisdictional funding of $25 million per year, it would be the same process, so once again we would work with the folks at Treasury Board when they're putting together the capital budget, the capital plan, and see which projects would be eligible for funding under that program. Typically what you tend to see are smaller projects, under $7.5 million dollars, that would be done. Once again, it's really about matching the project to the funding agreement so that we can leverage all of the federal funding, once again looking at what the need is across the province, from a provincial point of view, and then looking again at the priority list.

Under the Base Funding Agreement, there hasn't been an allocation established for municipalities, however, both HRM and CBRM are cost sharing on some projects under the Base Funding Agreement.

Under the stimulus program, there has been the $108 million. There was $14 million that was set aside for HRM and CBRM and the funding for that program - or the way that

that number was established - was that matched the community's component top-up that was under the federal government's Economic Action Plan. There was the $14 million established and that was bumped up again to allow for an additional $4 million for other municipalities across the province, and then an additional for HRM. So that's where the funding for HRM and CBRM and the municipalities under stimulus have come from. In every other province there's a longer list of projects than there are funding dollars available.

MR. GAUDET: I understand. I want to ask a couple of questions on the gas tax fund. Under the Building Canada Plan, the feds have allocated $11.8 billion to the gas tax fund, so my first question, does the province receive any federal funding under the gas tax fund?

MADAM CHAIRMAN: Mr. Gorall.

MR. GORALL: That's an item that I spoke about earlier. That's the $58 million that comes annually to municipalities from the federal government. It actually comes to the Province of Nova Scotia and we distribute that based on a formula that the UNSM recommended to us.

MR. GAUDET: I understand that. I understand that the municipalities receive the allocation, or the funding allocation, under this fund but I'm curious, does the province receive any benefits, directly, out of the gas tax fund?

MR. GORALL: I apologize, I misunderstood the question. What the agreement does allow for is for any of the interest that could be generated - let me just take a step back. When the money comes to the province, we require specific reports to be filed by municipalities on how they're spending the money, the money that they've already received, and how they plan on spending the future money. That then releases additional funds from the province to municipalities. While it's sitting in our account, it earns a little bit of interest. That money gets transferred to municipalities at the end of the agreement.

There are two exceptions to that. The first exception is that the UNSM asked for and does receive, $100,000 a year out of the interest that is earned in our bank accounts. That goes to them and they use that to fund what's called the sustainability coordinator, somebody who works on behalf of the climate change committee, or subcommittee, of the UNSM.

In addition to that, about a year ago the province negotiated $100,000 as well, each year, that would come in to help us run that program. It takes about two people to run the program on an annual basis and what we've asked for, and received permission from the UNSM and the federal government, is that we would take $100,000 a year to offset those administrative costs.

MR. GAUDET: I want to move to the passing lanes that Mr. Stewart made reference to earlier. Back in March 2009 the Prime Minister was in the Valley to announce a $17.5

million investment for passing lanes in the Valley. The province said they would contribute $10.75 million and Ottawa would contribute $6.75 million. My first question is, how many kilometres of passing lanes was this $17.5 million funding suppose to help build?

MADAM CHAIRMAN: Mr. Stewart.

MR. STEWART: Off the top of my head, Mr. Gaudet, I believe it's about 10 or 10 and a half, it's six different lanes, three eastbound and three westbound and they're sort 1.4 kilometres to 1.8 kilometres each, so it's around 10 in total.

MR. GAUDET: Currently the department is involved in constructing two between the Coldbrook exit and the Berwick exit. I believe the tender called for 2.16 kilometres. You pointed out earlier, in a previous question, that we're currently just about completing Phase I. I would be interested in finding out where other passing lanes will be constructed along Highway No. 101. Is it possible today, or later, to get that information?

MADAM CHAIRMAN: Mr. Stewart.

MR. STEWART: The passing lanes between Berwick and Kingston came out of a Highway No. 101 safety study done in early 2000, if memory serves me correctly, and it talked about twinning certain sections of the highway and providing some passing opportunities. That study only identified the area between Berwick and Kingston, so at this point we haven't looked at going beyond that. We've concentrated on getting that section done and getting federal funding lined up for that, which we were successful in doing this year. At this point, that three-phase project is all that we have on our current radar screen.

MR. GAUDET: So currently between Bridgetown and Berwick, to my understanding, there are no passing lanes on that stretch of Highway No. 101. Currently the department is involved with the two constructions of passing lanes between the Berwick exit and the Coldbrook exit. I hear Kingston being suggested here. Is the department looking at calling a tender soon to pursue additional construction of passing lanes?

MR. STEWART: The project was broken into three pieces, one eastbound and one westbound lane in each piece. It's our current intent to call the second one of those for construction next year. I would anticipate that tender coming out some time in the Spring and then it would be our intent to call the third for the 2011 construction season.

MADAM CHAIRMAN: Mr. Gaudet, your time has elapsed, I'm sorry to say. I will turn this round of questioning to the Progressive Conservative caucus. It will begin with Mr. Hurlburt for 12 minutes.

HON. RICHARD HURLBURT: Madam Chairman, I apologize for being late this morning, I wish I had been here for the opening remarks. I'm sure they were very

informative, but I do have a loved one who is very sick in hospital and I've been spending a lot of time there.

I do have some questions I would like to get some clarity on. I must say to the members here today, you should be here during Question Period, because we're getting more information in the committees than we do in Question Period. Could you tell me, is there a master plan by the new provincial government for the stimulus infrastructure in our province?

MADAM CHAIRMAN: Ms. Fraser.

MS. FRASER: The stimulus program, certainly, as I had mentioned previously, there was an allocation to Nova Scotia for $108 million and we are 96 per cent committed on that. I guess under the objectives of the stimulus plan, it was a very focused and very detailed program, meaning that it had to be projects that were ready to go and projects that could be completed by March 31, 2011. The stimulus plan was really just one of the funding programs that we're looking at when we develop the capital plan and look at infrastructure needs and requirements across the province.

One of the challenges that we have is really slotting the various projects into the various programs that are available in order to maximize all the federal funding that's available. So to answer your question, there is a capital plan that we're looking to maximize all federal dollars, with the stimulus plan being one component of the federal infrastructure agreements.

MR. HURLBURT: I take from that answer it's a no, the new government has not created a new master plan yet for the stimulus and infrastructure in our province?

MS. FRASER: We are looking to maximize all federal dollars. There is a Building Canada Plan which is comprised of five separate funding opportunities. There is a Building Canada Fund. There is the Base Funding Agreement, Gateways and Borders Crossing, and the P3 Canada Fund as well as the Gas Tax Fund. What we're looking at are all the program needs across the province from infrastructure funding and slotting the major infrastructure projects that require a large capital contribution, over $7.5 million, and a long time to complete into that plan.

The Base Funding Agreement is certainly much more flexible. It's a very nimble program, so what we're looking at is, when we look at our large list of capital needs, what is the best place to put the funding, and so we would look to that program. Then, as well, projects that are typically rehabilitation and repavement can be completed within the two-year time frame, you know, there are no environmental concerns and they're incremental, then we would look to the stimulus plan. So it really is about maximizing all the federal

funding under the various programs and then slotting the projects that are on the infrastructure list into those funding programs.

MR. HURLBURT: Do we have a total value of all these programs that are cost-shared with the federal government? We hear numbers of $684 million. We hear $108 million. We hear $24 million for the CBRM and HRM, I think it is, or is it $15 million? There are a number of different programs. Do you have a master plan of the total value of all the programs?

MS. FRASER: Yes, we do. There are a number of different components in each program, so it does become quite difficult to keep track of. The Building Canada Plan is $634 million, and that's dedicated funding to the Province of Nova Scotia, so included in that is the $175 million for the Base Funding Agreement. There's the $235.7 million for the Building Canada Fund. There's the gas tax of about $223 to $224 million. That is dedicated funding that the Province of Nova Scotia will receive from 2007-08 to 2013-14.

In addition to that, there are also programs that are based on application and merit-based. So, for example, Gateways and Border Crossing is one that is $2.1 billion for the country, and Nova Scotia has been successful in receiving funding for six projects under that. There's also the P3 Canada Fund, which is a $1.25 billion program which all provinces and territories will apply for funding under that and will receive funding based on merit. So those would be the five major ones that would be included in the federal government's 2007 infrastructure plan.

The stimulus, the Economic Action Plan - there are a number of programs that are included in that. There was the Knowledge Infrastructure Program, there's social housing, the RinC program, the CAF program; there's a number of different components, and then the Infrastructure Stimulus Fund which was the $4 billion plan, which Nova Scotia's allocation is $108 million dedicated. So there is quite a mix of various programs dedicated to Nova Scotia, under the Building Canada Plan, and the Infrastructure Plan is $742 million with the ability to apply for funding programs under Gateway and Border Crossing and the P3 Canada Fund.

[10:30 a.m.]

MR. HURLBURT: Thank you. I was wondering if you could table the documentation to all the programs that you just outlined and the values on them.

MR. STEWART: Certainly.

MR. HURLBURT: Okay, thank you. Madam Chair, I'd like to now move on to transportation and discuss some issues in southwestern Nova Scotia. I'm wondering if Mr. Stewart could give the committee an update on Highway No. 103?

MADAM CHAIRMAN: Mr. Stewart.

MR. STEWART: Any particular part of Highway No. 103?

MR. HURLBURT: I'm quite sure you're familiar with the area I'm talking about through the Port Joli, Port Mouton area that was announced last Spring, I think it was.

MR. STEWART: Yes, for that particular section of Highway No. 103 we are still finalizing the functional design to go around Port Mouton and Port Joli. The actual announcement was just to go by Port Mouton. There will be an open house scheduled there some time this winter, I would expect, to consult with the community in the manner I mentioned when I was responding to the earlier question, that we will go with the proposed alignment that we have for that bypass and meet with the community and get their input and their thoughts on that alignment.

Because of the relatively short time frame that the money is available to 2013-14, we are going out and doing our environmental screening in advance of that, so hopefully we won't be too far off track when we have our community consultation. Once those two things are done, we'll then proceed to buy land and we hope to be in a position to be able to call tenders in 2011.

MR. HURLBURT: Thank you. Are there any other areas in this province that do not have a 100-Series Highway serving their communities, as southwest Nova Scotia. We have Highway No. 101, that is not completed yet, from Digby to the Weymouth area. We still do not have a 100-Series Highway there, and Highway No. 103, it's terrible. There's not a 100-Series Highway going on either shore to southwestern Nova Scotia. Are there plans for the Digby to Weymouth area? What is the next plan for Highway No. 103?

MR. STEWART: I guess, to a certain extent, it depends on your definition of a 100-Series Highway. From the department's perspective there is a 100-Series Highway in both directions to Yarmouth. Highway No. 101 is a 100-Series Highway all the way and Highway No. 103 is a 100-Series Highway all the way. Portions of those highways are not controlled access but they all carry full Schedule C all-weather loading, so there's no industry impediment to those areas. They would be no different than going to Sydney. If you go from the Strait, Highway No. 105, most of that is non-controlled access, similar to the sections of Highway No. 101 and Highway No. 103 that you're referring to, but again, it has the full truck loading because it handles, of course, all the traffic to North Sydney.

If you go up the west side of Cape Breton Island, there is controlled access highway as far as - sorry, the east side of Cape Breton Island - there is controlled access highway as far as St. Peters but thereafter there's an upgrade, or we're in the process of upgrading Trunk 4. If you go down the Eastern Shore, you get as far as Musquodoboit Harbour with a

controlled access 100-Series Highway and thereafter you have Trunk 7. If you go up along the Northumberland Strait, we have Trunk 6. There is no Highway No. 106 up there at all.

So in terms of the ability to move goods and freight and industry, you have a full connection along both the South Shore and through the Valley for 100-Series Highways. The other thing, of course, that you have to look at in those types of things is what are the traffic volumes. We have sections of 100-Series Highways around Halifax that would have 60,000 cars per day on it. If you go down to Highway No. 103 and Highway No. 101 and those areas of the province, you are down around to 2,000 cars a day. So obviously traffic is a consideration in where we put upgrading dollars.

I referenced Highway No. 105 earlier, going up to North Sydney from Aulds Cove, which is largely non-controlled access as well. It would have volumes in the 5,000 or 6,000 kilometre range. So there's quite a variety of conditions around the province, but you're certainly fully serviced in terms of loadings and the ability to move goods.

MR. HURLBURT: Madam Chairman, I apologize for my opening comments because you're taking too long answering the question and I'm not getting enough questions out. The study for southwest Nova Scotia, what is the status on the study for southwest Nova Scotia for transportation?

MR. STEWART: I'm afraid I can't give you a full answer on that one because the department has a person who sits on the steering committee, but that project is actually being run out of the Department of Economic Development, or in conjunction with ACOA, we're not the lead on that study. I'm afraid I can't answer your question in detail, sorry.

MR. HURLBURT: The funding for transportation across the province, is it distributed fairly across the province to all regions?

MR. STEWART: I guess there are several components for the funding. The major construction, the Antigonish Bypass , the Highway No. 101 projects, those sorts of things are usually federally funded, so we jointly arrive at those priorities with the federal government. They are usually large amounts of money that go for very short, specific projects. In terms of the general bridge replacement, repaving, those types of projects, they are primarily need-based, although we certainly make an effort to make sure there is work in every part of the province. As my colleague said earlier, you have contractors in all areas of the province, you have people who live in all areas of the province and everybody has need, so the primary driver is technical considerations for need. Certainly, we do strive to ensure some geographic balance in that as well.

MADAM CHAIRMAN: The time has elapsed for the Progressive Conservative questions. I'm going to turn it to Mr. Preyra for the NDP caucus, the last 12 minutes of questions.

MR. LEONARD PREYRA: Thank you, Madam Chairman, I'm only going to take about 30 seconds and I'll hand it over to the member for Cole Harbour-Eastern Passage. I want to get back to the question about the master plan, Ms. Fraser, in your capacity as executive director of strategic planning and infrastructure planning. As I understand it, the province had identified approximately $8 billion to $10 billion in infrastructure needs relating to highways and sewers. The department has now seen this as an opportunity with these stimulus packages, however you call them, coming forward to leverage provincial dollars and federal dollars to maximize our ability to meet those needs.

In partnership with the federal government and with the municipalities we've come up with criteria for projects relating to core services, I guess, and allocated by population and other plans. That is largely the master plan, to look at these unmet needs, look at what's available now and how do we meet the top priorities now in the situation we're in. Is that a fair summary of that?

MADAM CHAIRMAN: Ms. Fraser.

MS. FRASER: There are actually two components in there, in the master plan that you speak about, which is the ability to leverage all federal funding that is available, that would certainly be the approach that we would take. We would look at what the eligibility criteria is under each program. For example, under the Building Canada Fund, the major infrastructure component, highway projects that are eligible for funding under that program are the core National Highway System projects. So therefore if we're doing a project on Highway No. 101, as an example, that would be where we would typically go to seek funding because it would meet that eligibility criteria.

Under the Base Funding Agreement there would be fewer restrictions so we could do the non-core National Highway System and that would be the category that Highway No. 103 is in, so the Port Mouton bypass, that's where the funding for that would come from. The same approach would be used for stimulus funding, look at eligibility, look at the program needs, the list of infrastructure projects that are on the list, if you will, and try to slot those and to leverage as much funding as available.

The other component of that is looking at the long-term infrastructure plan. That is at a multi-year higher level, more strategic document, and that's looking at what assets does the province own, what are the needs out there, how to we ensure that the assets that we have are maintained and the sustainability of them, and looking at changes in demographics, changes in taxation and service delivery. That would be looking at decision-making frameworks and really helping to set the stage for funding in the future years and the maintenance of the infrastructure assets that the province and municipalities have.

MR. PREYRA: Thank you, Ms. Fraser.

MADAM CHAIRMAN: Ms. Kent.

MS. BECKY KENT: Thank you, Madam Chairman. The province clearly is the hub of the whole achieving process to get this infrastructure money here and soundly in the hands for the projects that are required. I'm wondering if you can take some time to elaborate - and perhaps this is for Service Nova Scotia and Municipal Relations - on what our government is doing from department level to really make sure - because it has been alluded about fairness and making sure that we clearly, our government - clearly, I think every member in this House, all Nova Scotians want to see us have the best chance we possibly have of taking advantage of this funding opportunity. Doing so, we know that the process can be cumbersome and the details, at any given time, have the potential to either change or be worked out or need clarification.

I know that from a municipal standpoint, having been on council - and many members here today can appreciate when these funding opportunities come along, we rely on our staff, the staff of the municipal units, to work with the departments to understand what they're going to need to put forward so they can get what they need for their municipalities.

I ask if you can give me a better sense of what our department is doing from a municipal standpoint to make sure we get every municipal unit out there that has an interest, because my understanding is every municipal unit has the opportunity to apply, to make sure that they all get the due consideration, the time, the resources allocated to them to get their best foot forward, to make sure that they have every chance of success. Can you give me a little sense of what our department is doing for that?

MR. CHAIRMAN: Mr. Gorall.

MR. GORALL: Yes, a couple of things. What we started off with a number of years ago was we had the Canada-Nova Scotia Infrastructure Agreement back in 2000. It's a $195 million agreement, and that was based on sort of a distribution based on county allocation at the time, and county allocation was partly based on population, your share of population and your share of unemployment back then. It was sort of a job stimulus effort back in 2000.

What we did was we worked with the municipalities to submit their applications and to make sure that what they did was put in their number-one priorities based on need. We would work with them at a staff level to make sure that those projects, those number one priorities were, for the most part, adhered to.

What has happened over the course of the last couple of years is that because the infrastructure programs have exploded - there is the gas tax, there is the transit trust fund, there was the transit capital fund, MRIF, MRIF top-up, stimulus, and the stimulus top-up, gas tax again. All of these programs in terms of how they've exploded in numbers of projects that we can support, different types of applications, so on and so forth, we've been forced to

change our philosophy a little bit in terms of Service Nova Scotia and Municipal Relations where we try to initially put - every dollar was pipes in the ground.

What we've done now is we've stopped and said, okay. Further to a question earlier around what does the infrastructure need out there, we didn't get into a discussion about what the municipal infrastructure need is. One of the reasons we don't know the accurate answer to that is because it's evolving, and partly it's because - how do you define what need is? For example, do you want to take every single house that has online septic systems and you want to treat them on a centralized sewage treatment plant? That's an option for Nova Scotians. Of course, that costs us probably $8 billion or $9 billion to do across the country, so is that need or not? How you define need changes a little bit.

We found that, instead of just responding to whatever was coming forward from municipalities, what we wanted to do was increase our staff complement by a couple, to match what was taking place nationally with all the infrastructure programs. What we would do is we would actually start sending our staff out to help municipalities as they create these applications. The applications would come in, and they would be in better shape than they were initially. There would be less time developing and working with them on the tail end if we spent a little bit of time up front in terms of them actually applying correctly in the application process.

[10:45 a.m.]

Now with respect to what we're doing under the gas tax specifically, this is a really interesting piece that we've developed in concert with the federal government. When they announced the gas tax agreement in 2005, they did it by agreement so the funds would come to the province and we would then distribute it to municipalities, based on some reports that municipalities would give us.

One of the things that we suggested to municipalities is, if you want to have these funds, you have to create what we call an Integrated Community Sustainability Plan - ICSP is the acronym that we use. ICSPs require municipalities to sit down and meet with their constituents to talk about what their long-term planning needs are and how infrastructure matches that. That would be sort of year five and six of the agreement.

But, years up through five and six would actually escalate the requirements for municipalities to do capital planning. They would initially give us a wish list of capital projects and then that would escalate up to a capital budget, so that's sort of a three-year capital budget, and then by year five, as part of their ICSPs, what they have to do is this requirement to continue to get the gas tax is they have to be able to demonstrate that they have a long-term sustainability plan for their community that includes climate change and that their capital planning actually matches what that view is.

Those are some of the things that we're doing to support municipalities in their applications.

MS. KENT: That's good to hear. I appreciate that, thank you. I know that it's been suggested you're going to table, or perhaps we already have a list of the approved projects and such, but could you take a moment to elaborate a little bit on what's actually happening right now? Give us a sense of some projects that are ongoing right now and a bit of a timeline on when you anticipate seeing some more across Nova Scotia start up. If I could add in there, because we're running out of time, could you touch on the Mount Hope project?

MR. STEWART: I'll speak to the Mount Hope project, I guess. The Mount Hope project is a shared project between the project represented by InNOVAcorp, the city and the federal government. The tendering of that project and the construction supervision is actually going to be done by HRM. The province is really just a funding partner by InNOVAcorp and certainly it's a project of interest both to the city and ourselves and it provides that connection from the industrial park up to Highway No. 111. I think HRM also has some transit needs that relate to that connection being built. My understanding is that it's supposed to go to tender this Fall. It's probably been a month since I spoke to somebody about it, so that may have changed, but that was my understanding, to get the roadbed work done through the Fall and let that settle over the winter with an idea to pave it next Spring, but that's about a month old.

MR. GORALL: The first part of that question was, not to put words in your mouth, I just want to make sure . . .

MS. KENT: Projects ongoing, projects that have already started. Just give us a sense of a few and then a sense of what the timelines might be for those that are pending and ready to go.

MR. GORALL: Right. In terms of projects that have been committed, one of the items I've committed to giving to this committee is a list of all of the community component projects so I just want to give you a sense as to what some of those are.

Some of them, for example, Annapolis County, we had an announcement as early as August 2008 to do some projects there. In terms of total project costs that we're doing under that program, projects underway right now is about $8.8 million in Annapolis County. As I work my way through alphabetically, the . . .

MADAM CHAIRMAN: Mr. Gorall, could I just ask - the time for the NDP has elapsed - but would that information be in the list you're going to give us?

MR. GORALL: Absolutely.

MADAM CHAIRMAN: Okay, so we will all have access to it. I didn't want to stop you if there was something different or new. Thank you very much. We do have some committee business, which is why we're finished a little early today, but I'd like to ask our witnesses, perhaps Ms. Fraser, or if any of you, have any closing remarks for the committee. I certainly want to thank you for being here.

MS. FRASER: We don't have any formal closing remarks. I do want to thank all the members for their interest in the programs, and the questions. We will be tabling the information that was requested and we'll have it forwarded to the Chair. Thank you.

MADAM CHAIRMAN: Thank you very much. I would like to thank our guests again for being with us today. I think it was very interesting and the information that you've promised to provide us I think will really round out the discussion. I have a list of those documents and if you would send them to the clerk of the committee that would be wonderful. Mr. Gorall, I think you had some available today that maybe you could leave with us. Thank you very much. I won't ask you to wait while we do our committee business, please feel free to leave and we'll get on with the committee business today.

We have had a meeting of our Subcommittee on Agenda and Procedures since we last met as a committee and the report is before you today. Each one will have a copy of that. We had looked at a couple of additional items to come as well as the ones which were previously approved. So what you have before you on the list of topics includes quite a number that were previously approved but I'll just draw your attention to the things that were new.

One was the motion that was made at the agenda setting meeting, it was made by Mr. Clarke, I believe, to bring in the Nova Scotia Fisheries and Aquaculture Loan Board to attain clarification on the loan application process. We had quite a bit of discussion at the time in response to two letters received, to me as chairman of the committee, one from the Liberal caucus and one from Progressive Conservative caucus asking that we call for the Minister of Fisheries and Aquaculture and the Deputy Minister of Fisheries and Aquaculture but the motion coming forward was to ask for more information on the loan process. So we have that before us, with a tentative date of November 25^th, but that requires approval of the committee as well.

Also, the issue of pandemic preparedness where we wanted to call the district health authorities, that's confirmed for November 18^th. That had been a suggestion of Mr. MacKinnon when we had our first meeting on pandemic preparedness - that we hear from district health authorities. So that is now before us to be endorsed by the committee today.

We also need approval on moving our training day, our workshop on the Attributes of Effectiveness for Public Account Committees to three hours. We wanted to schedule it during a committee meeting, but there is a lot of information that they have to bring to us and we would like a three-hour meeting for that in January.

So with that I will move that this be put before the committee.

Yes, Mr. Preyra.

MR. PREYRA: Madam Chairman, I would like to speak to a couple of issues on the agenda as we had discussed them previously. The question of the Nova Scotia Fisheries and Aquaculture Loan Board, as you know, we feel that this is really more political posturing than anything else. This Fisheries and Aquaculture Loan Board recommendation that is on the agenda is really a back door way of getting to something that the Opposition Parties could not get anywhere else. This is a way of dealing with a response that Opposition Parties got from the Conflict of Interest Commissioner, who said that the Opposition Parties had no reasonable or probable grounds. The Conflict of Interest Commissioner has said that the minister asked for advice, he got that advice, he acted on that advice and there is nothing to suggest that anything improper was done in that loan. So we would oppose this vigorously.

Apart from this committee not being able to look at particular applications that are before the Fisheries and Aquaculture Loan Board, I think this is really just a way to get the taxpayers to fund a fishing expedition that the Opposition Parties are on.

MADAM CHAIRMAN: Any other comments on that?

Mr. Porter.

MR. PORTER: I've been on this committee since I've been elected in 2006 and I think this committee has discussed many times about setting politics aside in the interest of people and looking back at the spending that has taken place. I think, given some of the clarity that does need to come forward surrounding this issue, there has been money spent and the minister is involved in this. We're not sure, the Conflict of Interest Commissioner - you can say all you want about this, but as all of us in this Chamber right now, there have been a number of issues raised regarding the money going out and how it's being spent and the taxpayer has every right to know. We would like to see this remain on the agenda and see the folks before us, so we can clarify it. If there is nothing to hide, great, let's bring them forward and let's get a clear piece of how all of the spending is going and so that the taxpayers of Nova Scotia are very clearly aware of how this is not political, and is open and transparent. That is what this committee is and has been about.

MR. CHAIRMAN: Okay, thank you very much.

Mr. Gaudet.

MR. GAUDET: Madam Chairman, just as a follow-up to my two honourable colleagues. I think from my recollection, since I've been on this committee over the years, this is an opportunity to provide taxpayers with the information exactly when it comes to

provincial tax dollars, where they're being spent and some taxpayers - maybe not everybody - but I'm sure that some taxpayers in our province would like to know.

As the honourable member for Halifax Citadel-Sable Island indicated, you know, there's nothing to hide here. This is an opportunity for the minister to come forward. We've had previously government ministers who have appeared before the Public Accounts Committee to provide some information and to set the record straight. So again, you know, when I hear this is political games or political posturing - this is an opportunity for the Minister of Fisheries and Aquaculture to come clean, to provide clarity to this issue. By failing, you know, for the minister to appear, if my honourable colleagues from the NDP decide to turn this down, obviously it creates another cloud over this issue once again.

Madam Chairman, I'm prepared to move that we bring the Minister of Fisheries and Aquaculture at the meeting scheduled for November 25^th.

MADAM CHAIRMAN: Mr. Preyra.

MR. PREYRA: Madam Chairman, the argument of the Opposition Parties really rests on two fictions that they're trying to create. One fiction is that somehow the minister was involved in some wrongdoing when all the evidence points to the contrary. He asked for advice from the Conflict of Interest Commissioner, he got that advice and he took that advice, and that's the only thing the Opposition Parties have been able to show.

The other is that somehow the Public Accounts Committee is going to remake itself as a quasi-judicial independent committee and look at this issue in a non-partisan way. I think both of those are completely untrue and unlikely, and we're opposed to it for those reasons and other reasons.

MADAM CHAIRMAN: We do need to look at this as a motion that was just put by the member for Clare. Mr. Gaudet had made a motion that we actually bring in the Minister of Fisheries and Aquaculture. We also have before us the motion which is from the committee which is the complete package of items that are on there. So we need to deal with both of those I think independently. I haven't heard a motion from the NDP caucus at this point although I'm sure you can yet bring one.

I'm not sure of the order in which we should deal with these so I'm going to ask our legislative counsel, if I could, to look at that. The original motion is for the complete list of items to come before the committee. Mr. Ferguson.

MR. NEIL FERGUSON: I don't know if there was a motion for that. I think the Chair requested somebody to make a motion rather than making a motion from the Chair. So I don't think there was actually a motion for the whole package yet. So the only motion that

would have been made to this point is the one made by Mr. Gaudet and if I could just make a comment.

MADAM CHAIRMAN: Yes, please.

MR. FERGUSON: I'm not sure what was intended by the words "bring the minister" because the usual protocol is, first, an invitation and if the minister declines, then the committee does have the power to subpoena. So the use of the word "bring", he might want to . . .

MADAM CHAIRMAN: Yes, Mr. Gaudet.

MR. GAUDET: Madam Chairman, I'll try again. Maybe the motion should read that this committee extend an invitation to the Minister of Fisheries and Aquaculture to appear before the Public Accounts Committee on November 25^th and allow him to provide us with the information that taxpayers are looking for. Again, if there's nothing to hide here, we will certainly bring a close to this matter.

MADAM CHAIRMAN: And is there a seconder for that motion? Yes, Mr. Porter, and would you like to speak to that?

MR. PORTER: I will second it. Before doing so, did you not raise the issue, Madam Chairman, that Mr. Clarke had also - was there a motion made by Mr. Clarke?

MADAM CHAIRMAN: No, I read the motion. In fact, the motion from the committee did not include the minister. It called for calling the Fisheries and Aquaculture Loan Board and I read his statement from the committee meeting that we had. That would be the subcommittee . . .

MR. PORTER: Thank you for that. So are we going individually then based on this current motion and then go back to the balance of the agenda?

MADAM CHAIRMAN: That is what our legislative counsel has suggested.

MR. PORTER: I will second the motion put forth by Mr. Gaudet.

[11:00 a.m.]

MADAM CHAIRMAN: So my intent had been that we get the other dealt with and then afterwards, we'll look at the complete package. So there's a motion before us to extend an invitation, were the words used, to the Minister of Fisheries and Aquaculture to come on November 25^th, the date which was set aside for that in the agenda. Is there any further comment on that? (Interruption) Yes, okay, I would like to call for a vote.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

I'm afraid the motion does not pass today.

So that has been dealt with. We still have on the agenda what was approved at the Subcommittee on Agenda and Procedures and that was to call theFisheries and Aquaculture Loan Board. I'm sorry, Mr. Gaudet.

MR. GAUDET: Madam Chairman, I would like to make a second motion - the fact that the committee or the subcommittee had looked at the possibility of inviting the staff from the Fisheries and Aquaculture Loan Board to appear before the committee. Maybe a motion should be entertained at this time to extend an invitation to the staff from the Fisheries and Aquaculture Loan Board to appear before the Public Accounts Committee to provide us with information, in terms of loan application and process, regulations and guidelines. I would so move.

MADAM CHAIRMAN: Thank you very much and it is seconded but, in fact, that was the recommendation from the committee as well. So would you like to move the whole package of the items that are on our agenda? (Interruption) Just the one, okay. Is there any further discussion on the staff from the Fisheries and Aquaculture Loan Board? All right, I would like to call a vote on that.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

I'm afraid that motion is also defeated.

That means that has been removed from the list because we have now dealt with it independently. That does leave us with a gap in our schedule for November 25^th at this point in time but we can vote on the rest of the items that are presented here. Some of them have been previously approved and I'll just remind you that the truck safety, the in camera meeting with the Auditor General, as well as the public meeting with the Auditor General have been approved as has the financial review and tax review which is the Deloitte study which is set for January 20^th tentatively. So if we could just vote on the complete package now, that would be good. Mr. Preyra.

MR. PREYRA: Madam Chairman, I would like to speak to an item on the agenda.

MADAM CHAIRMAN: Yes.

MR. PREYRA: I would like to speak to the Deloitte issue. As we have discussed in the Agenda and Procedures Committee, the NDP caucus is opposed to bringing that report forward in large part because it doesn't deal with actual expenditures of a particular government department or program. This was looking at future revenues and future

expenditures. It's something that has been dealt with. The report itself has been released. There has been a great deal of discussion. There's been a lot of discussion in Question Period. It has been raised in estimates. There have been questions about whether or not it's just a consulting contract and really not an expenditure of public money beyond the expenditure for the report itself and so for a whole variety of reasons we think it should be removed from the agenda.

MADAM CHAIRMAN: Mr. Porter.

MR. PORTER: I thought that this was previously approved at a meeting that we had gone through, one, not just, I forget the word that the honourable member used, we spent $100,000 of the taxpayers' money, already spent this money to go through this audit process. I think it's worthy of being before this committee. There's a lot of value in having the Deloitte group here to go through and this is all about dollars and cents. It's all about spending past and our caucus wants to see this remain on the agenda.

So I would move that it stay on the agenda and I'm not sure what the ruling is. Maybe we'll need to ask legislative counsel, Madam Chairman, with regard to previously being passed - at least I thought it was, and maybe I'm wrong on that but I thought that this was passed at a previous meeting. This came up early on, if I recall, at one of our first subcommittee meetings.

MADAM CHAIRMAN: This item actually was put forward at the September 2^nd agenda-setting meeting and was passed by the full committee on September 9^th, our next meeting. So it had been previously approved and set in the agenda so we've asked our clerk to schedule it. You know, I'm not sure what we would do in that case. We've got an item before us where Mr. Preyra has indicated he doesn't support it but, Mr. Porter, as you say, it has been previously accepted.

What I would ask is that the committee just look at one note and that was the note given to me from our agenda setting, which was that our intent in bringing the Deloitte group to the committee would be to get an understanding of the economic climate and to examine the government's action regarding the study that was done, the $100,000 that was spent, which is past expenditures which does fall within our mandate very clearly.

Yes, Mr. Gaudet.

MR. GAUDET: Thank you, Madam Chair. Maybe we could ask our legal counsel to provide us with some guidance. The fact that this request was previously approved by the Public Accounts Committee and this morning we have a different concern that has been raised. So just for clarity for myself and I'm sure for all members of the committee, maybe if we could be provided with some guidance or direction here on how to proceed, I'm sure it would certainly be appreciated by all.

MADAM CHAIRMAN: Thank you. Mr. Ferguson, could you help and advise us on this?

MR. FERGUSON: Yes, I think I heard the beginning of a motion that remained on the agenda and I don't think you would need a motion for something to remain on an agenda; it is there. The question is whether you would, if you want to change the agenda of the committee, whether you would rescind the original motion or whether you would simply bring a new motion, that the agenda be altered in some way, in this case by removing the item. So at this time I haven't heard a motion to that effect or to either of those effects but if the majority of the committee decided to remove something from the agenda that the committee had previously voted on, I believe that would be within its power.

MADAM CHAIRMAN: Thank you. Ms. Kent and then Mr. Preyra.

MS. KENT: Yes, it has been suggested that it was approved in the past. Can I get clarity on when that happened? It is my understanding now that it hadn't been and why would it be here as a suggested date? I want clarity on exactly when that was approved.

MADAM CHAIRMAN: Certainly, yes. Mrs. Henry, would you like to just confirm that?

MRS. DARLENE HENRY (Legislative Committee Clerk): Yes, it was during the full committee meeting on September 9^th.

MADAM CHAIRMAN: The reason the suggested date is there is that they just haven't been confirmed on that date. The item has been confirmed, they've been confirmed as witnesses we want to see here at the committee but we just haven't scheduled the date in a concrete way yet. Mr. Preyra.

MR. PREYRA: Madam Chair, as I recall the discussion at the Committee on Agenda and Procedures, there was a question about whether or not this was an interim report or a final report. I think the suggestion at that time was that we not proceed on this item until there is a final report to be seen and we would decide at that point whether or not we would move forward on that. That was certainly how I understood the discussion so I would say that presenting this as a decision or a recommendation coming from the agenda and procedures really exaggerates our commitment to actually going ahead with this at this point, as a committee itself.

MADAM CHAIRMAN: Just for clarification for the committee, I think there's no question that it was an item on the September 2^nd agenda setting and was brought to the committee as a complete package, one of the items as September 9^th and approved here at the committee.

We discussed it further at the next agenda-setting subcommittee meeting with the intent of wondering whether we should hold the date a little bit later, so that the second report might already be in. I think Hansard will show that we discussed that and that we thought the second report would be available if we scheduled this in January, which is one of the reasons why it remained open. We could always check Hansard on that but that item has been completely approved September 9^th, that's confirmed. Mr. Gaudet.

MR. GAUDET: Thank you, Madam Chair. Just to maybe continue with your last comments, maybe we should ask the Chair to verify with Hansard what was said and maybe to bring it back at the next meeting of the Public Accounts Committee. Rather than just trying to push this either way, just for the sake of information and to make sure that everyone has the correct information, I would suggest that we delay this matter and to allow the Chair to check Hansard and then bring it back to the attention of the members at a later date.

MADAM CHAIRMAN: Is everybody in agreement with that approach? Okay, very good. We will be meeting here again next week on the 4^th. Normally we would be having again another subcommittee meeting on November 4^th so perhaps we'll leave time for that after our full committee meeting is over and we can see what business there is to attend to there. We'll bring this list back of the items that are scheduled from the subcommittee, with the exception of November 25^th, which we had a motion today which removes that item from the list. So it will return again for the meeting next week. Mr. Preyra.

MR. PREYRA: Thank you, Madam Chair. We also have one item on the agenda that doesn't appear on this list and that is the question of emergency rooms.

MADAM CHAIRMAN: That is actually our next meeting. It appears on our agenda for the day. Again, that was completely approved on September 9^th and scheduled.

MR. PREYRA: But we had discussed this in agenda and procedures now twice and both times the NDP caucus argued that the closures themselves are not the subject for the Public Accounts Committee because that is just a debating item. We're talking about expenditures and resources and whether or not public monies are being spent in the most effective and efficient ways. We had agreed, I understood, that we would remove closures from the topic and that we would look at Department of Health resources and allocations for emergency rooms and I see this back on the agenda again.

MADAM CHAIRMAN: We did discuss the semantics of that. I think we agreed that we would just call it emergency rooms. Staff in charge of emergency rooms will be here to have that discussion on the 4^th. That being said, we will remove that from the title. I have no objections to that. I think it was agreed upon. I think it's semantics.

With that, we have a motion to adjourn. I'm sorry, Mr. Preyra.

MR. PREYRA: Just to be clear then, the subject of that meeting will be about expenditures in the Department of Health.

MADAM CHAIRMAN: Mr. Preyra, when the items come before us we look at expenditures and program allocations and resources and planning. Those are all issues that the questions cover as they did today. We do not prescribe to our members what they can ask. We don't tie their hands in this committee.

MR. PREYRA: But we will be looking at expenditures and strategies and revenues allocated to those projects.

MADAM CHAIRMAN: To ensure good service in Nova Scotia. That would be the intent always, to give good value for money in Nova Scotia.

MR. PREYRA: So we're looking at the effective and efficient use of resources within the Department of Health as it's allocated to . . .

MADAM CHAIRMAN: Expenditures as are laid out in our mandate for this committee but our mandate is broad in this committee and I remind members of that and the history of this committee in Nova Scotia.

MR. PREYRA: Well it's not so broad, with respect, as to go beyond in looking at the whole range of future policies and public debates about emergency rooms and so the Public Accounts Committee is there largely to look at expenditures and whether or not public monies are being utilized in the most effective and efficient ways. There is a difference between the actual expenditures of money and public debates about government policy.

The Public Accounts Committee is not a committee that is there to, in fact, debate policy; that's the Legislature's role. The Legislature sets the policies, the Legislature approves them. The Public Accounts Committee is there to look at whether those expenditures were done in accordance with the rules and general principles that were set out by the Legislature itself. I want to make sure that we're still on that track and that Public Accounts is still going to function along those lines as a review of public finances.

MADAM CHAIRMAN: Thank you, Mr. Preyra. There is a comment from Mr. Porter.

MR. PORTER: I'm discouraged of hearing so much about what we want on the agenda, what we don't want on the agenda and I would suggest only one thing. At the sub-committee meeting next week, if Mr. Preyra would like to lay out the agenda for the balance of 2009-10, perhaps he should come prepared to do that next week in sub-committee.

MADAM CHAIRMAN: I do think that we have exhausted this discussion today and with the permission of the committee, we'll have a motion to adjourn. Thank you very much and we'll see you next week.

We are adjourned.

[The committee rose at 11:14 a.m.]