Minister Receives UNSM Proposal

The provincial government formally received the fiscal-exchange proposal of the Union of Nova Scotia Municipalities (UNSM) on Tuesday.

The proposal was presented at a meeting between Angus MacIsaac, Minister of Service Nova Scotia and Municipal Relations, and UNSM president Anna Allen, mayor of Windsor.

The minister thanked the UNSM for its leadership role in developing the proposal and consulting its membership.

"This was a huge undertaking and I appreciate the UNSM's efforts in what was no doubt a difficult and challenging task," he said. "I am also pleased to see the majority of municipalities continue to support the principle of equalization."

The province's original proposal, presented to municipalities in March, generated much discussion and debate around the idea of funding equalization through property taxes.

The UNSM's proposal would fund equalization through a mandatory 1.5 per cent deed transfer tax. Mr. MacIsaac acknowledged that not all municipalities currently levy a deed transfer tax. Of those that do, few levy the full 1.5 per cent. "This is something we will have to consider when we evaluate the UNSM's fiscal exchange proposal in full," he said.

Also part of the UNSM's proposal are some significant requests that are cause for further consideration. For example, the proposal calls for a significant increase in property taxes for Nova Scotia Power.

"It's a multi-million dollar double-edged sword," he said. "The cost of energy has a direct impact on residential ratepayers and consumers, not to mention the competitive position of this industry. We need to be extremely cautious before we take steps that could possibly be detrimental to economic growth, jobs, or electricity rates for consumers."

He added that any decision would be directly linked and consistent with the province's work in developing a comprehensive energy strategy.

The minister said his department will take the time to consider these issues carefully and make a decision based on a full examination and understanding of the impacts of the UNSM's proposal on municipalities and citizens. The province will continue its discussions with the UNSM and municipalities and expects to have a final decision by the fall.

In April, the province agreed to the UNSM's request for a 90-day extension to develop its own fiscal-exchange proposal and consult with municipalities. The UNSM executive committee passed a resolution, moved by Mayor Peter Kelly of Halifax Regional Municipality and seconded by Mayor John Morgan of Cape Breton Regional Municipality, to present the alternative proposal to the minister.