Mr. Chairperson (Marcel Laurendeau): Would the Committee of Supply please come to order. This section of the Committee of Supply will be dealing with the Estimates of the Department of Rural Development. Would the minister's staff please enter the Chamber at this time.

We are at Resolution 13.1. Administration and Finance (b) Executive Support (1) Salaries and Employee Benefits on page 131 of the Estimates book.

Mr. Clif Evans (Interlake): I just want to ask, and I do not believe, but have there been any major changes of any kind in the staffing within the department in the past year, any significant changes, support staff?

Hon. Leonard Derkach (Minister of Rural Development): No, there have been no changes in the staff complement in this area.

Mr. C. Evans: We can pass that.

Mr. Chairperson: 13.1 Administration and Finance (b) Executive Support (1) Salaries and Employee Benefits $442,800–pass; (2) Other Expenditures $78,000–pass.

13.1.(c) Brandon Office (1) Salaries and Employee Benefits.

Mr. C. Evans: The Brandon office, of course, has been in place for many years. Any staffing changes there as far as numbers of people, and if the minister could just outline some of the work that the Brandon office is involved in?

Mr. Derkach: For the benefit of the critic, Mr. Chairman, I would like to introduce and I think we had done this previously, but Ms. Marilyn Robinson is the director of Human Resources; Mr. Winston Hodgins, of course is the deputy minister; and Mr. Brian Johnston is the chief of Financial Services.

With regard to the Brandon office, this office has been in existence now I guess since we took office, and it was developed in recognition of the fact that our second city in the province is a significant distance away from Winnipeg. We actually have two regional offices, one in Thompson and one in Brandon. Rural Development has responsibility for the operations and the administration of the Brandon office. The duties of the cabinet office include providing service to an area of rural Manitoba that includes the citizens in approximately 41 municipalities.

They field, of course, personal inquiries from rural Manitoba that are directed to government. They are involved with Rural Development and the Economic Development Board in Brandon and other rural communities, the Chambers of Commerce. They are involved with Industry, Trade and Tourism offices, and their responsibilities include the assurance of a strong and healthy community in the rural part of our province. They also undertake responsibility for organizing and co-ordinating the forums and consultation meetings and press conferences for ministers who are travelling in that area on a regular basis. They provide feedback to ministers and to our departments on issues that arise in that part of the province or rural Manitoba. They also monitor, I guess, the media issues that as they arise in the rural part of the province, and they make arrangements for ministers who visit in the Brandon area or the surrounding area to ensure that our travel plans are efficient so that we are not wasting time when we do get out to that area. They provide briefings for us as ministers regarding important events that happen in the region. They also alert us as ministers in various departments with regard to issues as they arise.

As the member also knows, they act as a co-ordinator and a facilitator for us as ministers but also, for that matter, when the critic travels with me to the area, they also will make sure that they provide as much service to the critic as they can as well at that time.

Mr. C. Evans: Pass that.

Mr. Chairperson: Item 13.1. Administration and Finance (c) Brandon Office (1) Salaries and Employee Benefits $158,600–pass; (2) Other Expenditures $60,400–pass.

13.1.(d) Human Resource Management (1) Salaries and Employee Benefits $131,800–pass; (2) Other Expenditures $27,200–pass.

13.1.(e) Financial and Administrative Services (1) Salaries and Employee Benefits $354,800.

Mr. C. Evans: Just on that, there have been no changes I see on staffing, and the increase in increment of financial resources, just the annual raises for the staff.

* (1500)

Mr. Derkach: The complement of staff is the same, and the increases that are noted are those that are for salary increases and benefits and so forth.

Mr. Chairperson: Shall the item pass–pass. 13.1. Administration and Finance (e) Financial and Administrative Services (2) Other Expenditures $196,700–pass.

13.2. Boards (a) Municipal Board (1) Salaries and Employee Benefits $774,500.

Mr. C. Evans: There are some issues where I would like to have the minister's indulgence perhaps in some of the questioning. When it comes to the Municipal Board, I understand that there has been a change. Can the minister explain the change that has occurred for the Municipal Board itself, changes on the board, chair changes, legal resources changes. Could he explain those?

Mr. Derkach: Yes, there have been some changes on the Municipal Board within the last year. Firstly, the chair of the board, Mr. Bob Smellie, retired, and upon his retirement we were able to attract Mr. Gerry Ducharme to the position, and I think the member opposite knows Gerry Ducharme.

Secondly, the executive director who is now Mr. Keith Heming, has undertaken the administrative responsibility for the board, and the position that was held by another individual previously, that individual found employment in British Columbia, I believe.

In addition to that, we have added two term positions to deal most importantly with the appeals of the City of Winnipeg. Also, there have been some changes to the membership of the Municipal Board. We have added members to the board who have expertise in land appraisals, land values and in areas which relate to Municipal Board types of work.

We have added several members to the board, and we have also had some changes to the board, as well, and if the member would like, I could go over those in greater detail.

Mr. C. Evans: I would appreciate that. I would appreciate the names of the new people especially, not necessarily the ones who have been part of the board, but the new ones.

Mr. Derkach: I will briefly read the names of the people who are on the board. There is Mr. Gerard Badiou, Herve Bahuaud, Albert Bilodeau, Robert Brazzell, Sophie Bulbuck, Donna Burner, Ken Carels, Wayne Collins, Gerry Ducharme, of course, is chair, Mr. Richard Edmundson, Harvey English, Russell Farrell, Gabe Forest, Max Friesen, Keith Heming, of course, is the executive director, Garnet Kyle, Joan McClelland, Constance McLean, Carole Miller, Maxine Plesuik, Don Pratt, Wes Reimer, Rens Renooy, Wendy Sigmar, Judy Smith, Sudesh Treon–Mr. Henry Wiebe was on the board, as the member knows, he passed away–and Robert Upton.

What I would also do is, I think there are two other brand-new board members who are not on this list yet, but I would provide a complete list for the member and identify those who are recent appointments.

Mr. C. Evans: I see, well, quite an increase in that department of around $300,000. My understanding is all these board members are available for the different regions of the province as Municipal Board hearings are called for different parts of the province. Except for the chair and executive director, these board members are available to participate in Municipal Board hearings in different parts of the province. If I am understanding correctly, it is not the fact that it is the same people going to the same places all the time. Is that correct?

Mr. Derkach: That is correct. We have hearings throughout the province on different appeals and outstanding matters that have to be dealt with by the Municipal Board. Our greatest number of cases, however, are within the city of Winnipeg. They deal basically with the city of Winnipeg appeals which, as the member knows, there has always been a significant backlog. What we are attempting to do is to reduce that backlog so that it is manageable and so that assessment is as current as it possibly can be for the benefit of the people who pay taxes.

Mr. C. Evans: The minister is certainly aware that there has been some indecision I guess and some questions, I raised some questions last year with respect to the Lorette lagoon issue. I still get correspondence and phone calls with respect to that issue and the point made out to me. I have written to the minister a few times on issues with this lagoon. Now, I know that the Municipal Board has made two decisions–correct me if I am wrong–a decision in '95 and a decision in '98. Can the minister tell me just where we are at with this Lorette lagoon issue as far as the Municipal Board's decision? Is it a final decision, people are asking. Are we going to get more decisions, more appeals, more hearings? Could he enlighten me with this? I would like to get as much detail on this issue as possible.

* (1510)

Mr. Derkach: The member is right regarding the decisions of the Municipal Board as they relate to the Lorette lagoon situation. As a result of the last decision of the Municipal Board, which had to do with the expansion of Lorette lagoon, the community then held a vote on whether or not they wanted to proceed with the expansion of the lagoon. That was turned down in the community. So the community has been forced to look at alternatives, because the existing lagoon is at capacity and does need to have something done about it.

I am under the understanding, the impression, that a solution is very close at hand in terms of looking at alternatives for providing that service to the community and that a recommendation will be coming to our office in the next short while. The member should also know that once a proposal comes forward that the community will still have to deal with the Municipal Board as it relates to any expansion or the reconstruction of the lagoon in the Lorette area.

Mr. C. Evans: I guess I can refer to the old board. Obviously, there are new people who made the latest decision or sat in at the latest Municipal Board hearing with the new chair, with the new executive. My understanding is Lorette has turned down both suggestions. I believe that the minister at one point in time recommended that the Municipal Board, both the minister and the Municipal Board recommended to council that they should bring two local improvement proposals to solve the lagoon under the problem they were having with it. The minister's quote is a decision could be made in favour of either one proposal or the other. Now you are talking about another proposal. What is that proposal now?

Mr. Derkach: Mr. Chairman, the member is right with regard to a letter that was sent asking that they come forward to the Municipal Board with both proposals. When I say they, I mean the community. The community, in its wisdom, chose only to come forward with one proposal, and that was the expansion of the existing lagoon. At that point in time, the decision of the board was that the community had to vote on it. The community then turned it down. But those are all local decisions that are made by the community, and now we are at a point where we have to find an alternative. The community has turned down the expansion of the old lagoon. So what we have to do now is look at the relocation of the lagoon, and between the Water Services Board and the community, alternatives are being sought with regard to the relocation of the lagoon, or as an alternative perhaps looking at tapping into an existing facility somewhere else in the region.

Mr. C. Evans: Okay, I will progress with that issue as far as this other place or other solution that the minister is telling me about. The Municipal Board has ordered a vote twice, okay. I guess what I am asking is: what mandate does this Municipal Board have in the decisions or its final recommendations?

The minister will remember that last year a letter was sent to the minister with respect to that, and the minister wrote back saying, well, it is up to them to decide. Then somebody wrote back something about a certain section of the act, that the minister could intervene, and we bandied that about last year.

It seems that this issue will not go away, and it seems that these communities in this area, it just keeps going before the Municipal Board which is costing money to not only local people but the taxpayers of the province. I realize that they are in a position that they have to get something in place because the lagoon has become a serious problem, all sorts of innuendoes brought in.

Can the minister explain exactly when something like this comes before the Municipal Board, why can the Municipal Board not, or can they, decide? Why do they keep going back to the people saying, well, you have to vote on this again or you have to vote on that again?

Now, this next proposal, are they going to say the same thing, go vote on it?

Mr. Derkach: As the member knows, the Municipal Board is there to work on or respond to a by-law that has been proposed by the municipality. What they are trying to do is find a resolution to a problem that exists in the Lorette community, to try and resolve this once and for all. Now, the board ordered a referendum only on one occasion. The other referendum that was held was done by the community. It had nothing to do with the Municipal Board. So the Municipal Board has only ordered one referendum calling for the community to decide whether or not they wanted to expand the existing lagoon, which was turned down.

I guess, Mr. Chairman, the Municipal Board's role in all of this is to vote on and to determine, based on the requests from the community, whether or not a project should proceed or not. When they asked the people to vote on whether or not they wanted to expand the lagoon, that was a very specific order given to the community with regard to dealing with the existing lagoon, because, as the member knows, there has always been an issue in the community with regard to which way the community should go, expand the existing lagoon or build a new lagoon and relocate.

The vote that was taken in the community was turned down, and therefore another solution has to be found, and the only solution that is available to the community right now is to either build a new lagoon and relocate or attach their system to an existing lagoon in the region. That decision has not yet been made, and the recommendation has not come forward as of this time.

Mr. C. Evans: I just want to point out to the minister that I am being very serious when I say, and I have more here, all the Municipal Board hearings, et cetera, et cetera, that, you know, it has come to this, and I basically have said that to me it does not matter how the community decides whether they are going to either expand or relocate, but it was my understanding at the beginning that it was a pretty certain thing. The money was in place through the Water Services Board, through Infrastructure, that the lagoon be expanded.

* (1520)

I raised the issue last year that all of a sudden it came down to the fact that, well, no, they do not want to expand it, they want to relocate it. Now since the new municipal elections, things have reversed themselves. Those who wanted the expansion, do not, previous, and those who wanted–so it is a tough one for me to try and understand, but my understanding, what I am trying to understand is that the Municipal Board should have–does it have some sort of a mandate? In other words, why does the Municipal Board keep saying–I will use the terminology "sluff off," the responsibility back to the ratepayers as far as what they are going to do with the lagoon? Do they not have a mandate to decide? They are part of the borrowing process also. They are part of the whole process.

It is like going back every time your son comes home with a pair of shoes, tell him that you do not like them, so go back and see if another pair of shoes will fit.

Mr. Derkach: Mr. Chairman, I guess in a normal situation the Municipal Board would make a decision with regard to expansion or the building of a new lagoon and would deal with the borrowing by-law that is put before them. However, as the member may know from his research, the community did take a vote regarding the lagoon situation prior to going to the Municipal Board. The Municipal Board was aware of this and was aware of the results of this vote and, as a result, decided that the community was the one that had to decide whether or not they wanted to expand the lagoon or build a new one. So, in its decision, the Municipal Board said, yes, we agree with the expansion of the lagoon. However, the community must take that decision through a vote, because they had gone through a vote previously.

As the member also knows, that vote was defeated, in terms of the expansion of that lagoon. So now the municipality is left with the situation where they have to find an alternative solution. That solution is relocating the lagoon and finding a suitable location for it, or tapping into an existing structure somewhere else.

The council is dealing with that right now. I spoke to the mayor about a week and a half ago, and he told me they are dealing with it now. At that time, he told me they had to have another public meeting regarding the situation, and then they would be making application to the Municipal Board as to where they wanted to relocate or whether or not they were going to be tapping into an existing structure somewhere in the region. That I do not believe has come in yet, but the reeve did assure me that the discussions were taking place in a positive way, and that indeed they were making some progress. So we are awaiting their resolution before the Municipal Board, and I am sure, once that decision is made, proceeding with either a brand-new lagoon or tapping into an existing one, that it will not take the Municipal Board a long time to make a decision.

Mr. C. Evans: If I may, a letter to me, dated May '99. I would like to just take a quote from it and ask: The borrowing by-law for this relocation was defeated by referendum in '95, refused again by the Municipal Board in '96. In '97, the R.M. of Tache applied again for funding approval for an expansion proposal. At that time, the funding formula for proposals had changed, and the expansion was eligible for a grant of 193 change from the MWSB. The borrowing by-law for that proposal was approved by the Municipal Board in January '99, but it was defeated by a public vote. The total cost for the proposed expansion project in '97 was estimated to be $620,000.

In February, March and April of this year, the R.M. of Tache, on behalf of the LUD of Lorette, has examined three more proposals for the relocation of the Lorette lagoon.

I guess what this person is saying to me is, this jumping around back and forth and the Municipal Board not being able to make a final decision, and if they have it was defeated by a public vote. So the Municipal Board is saying, here is what we are deciding, but you go and vote on that. We are mandating a vote.

I do not understand that. Can the minister explain that and also what I quoted here? Does the minister know where this new relocation proposal, where it is at?

Mr. Derkach: The member is aware that the Municipal Board did make a decision. They said they approved the expansion of the existing lagoon. However, they referred it back to the community for a vote because of the first vote that had been taken by, the first plebiscite that was actually undertaken by the community, the municipality itself. The Municipal Board in its wisdom felt that it should be the community who would be making that decision rather than the board making a decision when there were some pretty strong feelings on both sides of the issue in the community.

As the member also knows, when that vote was taken in the community, the expansion project was actually defeated by the plebiscite. Therefore, the community was left with making a decision about relocating the lagoon. Now, specifically where the lagoon is going to be located to I do not know at this time, but there are discussions with neighbouring communities in that region to see whether or not it makes some practical sense to join with another community and having one facility only, even though that facility may require some upgrading and some improvements to it. In the long term, however, there would be a net cost saving to the two communities.

That is where it is at right now. I do not have the details yet as to what the decision has been by the community. That is something that the mayor could not tell me when I met with him a week and a half ago. But certainly we are awaiting their decision. So the ball is in their court right now, to come back to the Municipal Board requesting what solution they see that is of a practical nature to them in their future needs.

Mr. C. Evans: What is the name of the community? Could the minister put that on record, please?

Mr. Derkach: The community, as I understand it, is looking at either putting up a new facility and relocating that facility to another part of their municipality or looking at a neighbouring community. That community is Landmark that they would be looking at in terms of joining their facility. There might be improvements that have to be made to that facility.

This is all in keeping with our taking an approach in a general sense about using the existing facilities to their largest and biggest and best advantage because, as the member knows, these facilities are expensive to build, both for the community and for the province. The taxpayer is the one who pays for it all. So what we try to do is encourage wherever possible for communities to take a look at a neighbouring facility that is adequate or perhaps, through some upgrading, can accommodate the needs of a community that has that need for the expansion of this facility.

* (1530)

We are taking that same approach with Lorette. We are acting as a catalyst, if you like, to allow something like that to take place. The member will also know that that is the same approach we take with water distribution in the province. We make it very clear that when we build a facility it is not specifically for that community alone, that indeed if there are needs and demands for water service within that region that, instead of building another facility, that particular enterprise or community that needs that water can tap into an existing facility to take advantage and is the best use of taxpayer dollars.

Mr. C. Evans: Obviously, if the minister has indicated that it is Landmark, that they are talking about a solution, what would happen if the community of Landmark then turns the proposal down, says no to the community of Lorette? Whom does this go back to? Is this part of the Municipal Board, part of your responsibility as far as decision once it is made? What kind of support is Rural Development or the Municipal Board giving this issue if they turn it down, say no to it?

Mr. Derkach: There could be a lot of what ifs in a situation like this. One cannot anticipate any of those situations. I mean, if the community should turn it down, then obviously the community would have to look at another alternative possibility. There has to be a solution to their problem. We are optimistic that we can work through the Water Services Board and the two communities in resolving the matter. I think that is our mandate, as a department and Water Services Board, to ensure that we find the most effective and efficient solutions for communities who have these kinds of projects ahead of them. I am not going to speculate here, Mr. Chairman, as to what might happen if a situation arose. I think what we as a department are doing is working very proactively towards accommodating the best solution for the community at the least cost.

Mr. C. Evans: It will be interesting, I understand that meetings are going to be held very shortly with the communities. The Water Services Board people and your department, will they be present to make presentations to both these communities as far as this proposal?

Mr. Derkach: The member must be aware that this is an issue of priority to the community and also to the department because of the situation as it exists today. The community itself has had I know of at least one meeting where they brought people together to talk about the alternative solution, and the mayor informed me that it was a positive meeting. They do have to go through that process to make sure that everyone in the community has an opportunity to have input and that also everybody in the community understands what it is the municipality is trying to do. I think that, as I recall, the mayor told me they were going to have another meeting in the area, and we are waiting for the results of that.

An Honourable Member: Which mayor?

Mr. Derkach: I am sorry, it is not mayor; it is reeve. Reeve Danylchuk, I think it is, William Danylchuk. We are simply waiting until such time that they have had an opportunity to explore the matter within their own community and get some direction from their community. Then we will be there alongside of them working towards a solution.

Mr. C. Evans: I am going to ask this question. With the relocation of existing facility, decision on either proposal or another, the question put to me is: would this mean that the Municipal Board would rule in favour of one by-law or another if, as a means of resolving their lagoon issue, the municipality were to initiate two local improvement plans, each with corresponding borrowing by-laws being sent to the Municipal Board?

Is that what that would mean by another proposal being put through and agreed upon? Are they having to make decisions overruling the other decisions that they made? Are they going to have to go before the Municipal Board again?

Mr. Derkach: Basically the board or the community or the municipality has to put together its borrowing by-law whether that borrowing by-law is for an expanded which they rejected for a new facility or whether it is joining another community for their needs. The Municipal Board would then consider their application, consider their request, and make a decision on that basis. They have now directed the community to take a vote. That has happened. Now the community, because of the vote, has to find an alternative location for a lagoon.

Mr. C. Evans: On a point of order, obviously what the minister is saying, what I am listening to and hearing is somebody, since the system has progressed, and this is what I am getting from the area, somebody does not like these Municipal Board orders and recommendations, so they keep going back. The minister shrugs. That is not only hearing, I am also sensing it. This decision for this lagoon for this area has cost the taxpayers a lot of money, and locally it has cost them a lot of money. The people, from what I am understanding, want the best possible solution to this lagoon problem. It seems to me that somebody does not like whatever is being proposed, and through the Municipal Board or somehow changes keep being made, keep going back, new proposals are being made.

I appreciate what the minister is saying, but I am sensing that and I want to put that on record, so that if it does occur, then we know that there has, perhaps, been some things going on that are not proper. The letters that I get–

The Acting Chairperson (Mr. Faurschou): The honourable member for The Interlake does not have a point of order. I would call upon the honourable minister to conclude a response to the question.

Mr. Derkach: The matter is clearly one that is in the hands of the local community. The municipality is the one body that has responsibility for making application to the Municipal Board. If they do not like the ruling of the Municipal Board, Mr. Chairman, they would have to, in some way, shape or form, be able to appeal it or carry on with life in another way. In this case, the Municipal Board said we will agree with your by-law. The by-law that was sent to the Municipal Board was a boring by-law asking for approval for the expansion of the existing lagoon. The Municipal Board agreed with that and gave approval to that. However, they said that the municipality should conduct a vote in the region because of what had happened previously. So the municipality held that vote and in the vote the people of the community said they did not want to see that expansion of the lagoon. The municipality now, in order to abide by the wishes of their ratepayers, is looking at an alternative. That alternative includes tapping into a facility at Landmark or relocating the lagoon to a different site.

* (1540)

Once they have decided on their course of action, the municipality will then forward again the by-law to the Municipal Board, and the Municipal Board will deal with it and make a decision as to whether or not they agree or approve the by-law that has been forwarded by the municipality. There was no interference by me as minister or by my deputy minister or anyone else in this matter. But what we re trying to do–and I know the member is not accusing us of that–is establish some kind of a process which makes sense for the area, so they understand what is going on; and secondly, that we make the most effective and efficient use of their dollars, because these are local taxpayer dollars.

There is another issue out there which is in relation to where the lagoon is now and where it might be in the future. People are sensitive to having a lagoon next to their backyard. Those are the kinds of issues that are swirling in the community that have to be addressed. Those are really matters that the community has to deal with.

Our Water Services Board basically deals with the community in a way in which we accommodate the requests that they are making on the basis of a sound business plan, if you like, and a practical solution to the problem they are facing.

Mr. C. Evans: I know the minister did indicate that I was not referring to himself or his direct staff of any sort of interference. I certainly was not, because that is not what I have been hearing. If I was hearing that, I would have said it, but to this point I have not heard that. But I have heard, and I have read all the correspondence to the minister, all of it. I have got a binder thick of it.

I guess the problem I have is that I do not believe that the majority of the people are getting the right answers out there. That is what I believe from what I am getting. Sure, nobody wants a lagoon in their backyard, but it seemed to me to be a logical–when I was first approached with this, I told both sides of the fence that it did not matter to me whether there was an expansion or a new location. That was not an issue as long as the issue that the Municipal Board and its decisions were being adhered to properly and what the mandate of the Municipal Board actually was.

The expansion as compared to the relocation as compared to the now proposal of the word that was provided to me on the phone yesterday was twinning. It is an enormous difference of cost between the first proposal that this community put forth and went to the Municipal Board for the by-law, working with the Water Services Board people and Environment, and all of a sudden that is not a good idea. Go back and vote again, and it is going to cost more money. It is going to cost the taxpayer, the local ratepayer, and the government more money to do this relocation, wherever it may be, whether it be a twinning or whether it go to one of the other two locations that are being considered to relocate. Those are my comments on that. If the minister wants to respond, fine.

Mr. Derkach: I think the member would appreciate that we would like to resolve this issue as well. Unfortunately, in the community itself I think there are two different views of a solution. There is one group who favours the building of the new lagoon. Another group favours, because of tax issues, the expansion of the existing facility.

The municipality really has to make its mind up about which way it wants to go based on the resources that it has to deal with the issue and, secondly, the most acceptable solution to the ratepayers in that area. That is why they are going through the process of having open meetings for the public to come and express their concerns. Then the municipality will have to make the appropriate decision based on the information that they gather, but there is no intent of the department to try and influence in a negative way a decision in that area.

What we are trying to do is act as a catalyst to resolving a situation which has been around for a significant amount of time. The member should also know that the Department of Environment is encouraging very strongly that we resolve this issue sooner than later.

Mr. C. Evans: I am aware of that. I have been made aware of it. I have been kept aware on this issue, going back from the very first meeting in correspondence that I have had. Again, I am only hoping that everything is being done in accordance with the rules and the laws and the regulations, whether it be the Municipal Board, the Water Services Board or Environment or Rural Development, that this be resolved. How long has it been? Seven years or eight years that this whole issue has been an issue in that area maybe. Perhaps, not as long, but it has still been an issue and it has been a contested issue.

The minister said, well, there are two sides, and I believe that both sides just want to see the right thing done, and as least costly as possible for themselves. I also understand that they want to expand within the area, so I certainly hope that this can come to some sort of a conclusion. I am sure I will be hearing about the discussions with the twinning proposal, as has been indicated to me occurring.

Mr. Chairman, I am fine with this line.

Mr. Chairperson: Shall the item pass? The item is accordingly passed.

13.2.(a)(2) Other Expenditures $273,300–pass.

13.2.(b) Surface Rights Board (1) Salaries and Employee Benefits $20,700.

Mr. C. Evans: Mr. Chair, just one quick question on that. We have the annual report for '98-99. Have there been any serious developments, any serious issues within the Surface Rights Board that the minister can share, or is their mandate still the same and things progressing fine within the system?

Mr. Derkach: No, no major issues to date. The Surface Rights Board continues to do its work. Of course, their role is dispute resolution between landowners and the oil industry, so there are always issues there, but they are not ones that are coming forward in a major way that I know of right now.

Mr. Chairperson: Shall the item pass? The item is accordingly passed.

13.2.(b)(2) Other Expenditures $15,400–pass.

Resolution 13.2: RESOLVED that there be granted to Her Majesty a sum not exceeding $1,083,900 for Rural Development, Boards, for the fiscal year ending the 31st day of March, 2000.

13.3. Small Business and Corporate Planning Services (a) Corporate Planning and Business Development (1) Salaries and Employee Benefits $690,800.

Mr. C. Evans: If I may just ask the minister, and I should have checked the records. I am getting away from this line right now. Under what line can we discuss natural gas?

Mr. Derkach: Mr. Chair, Infrastructure is where we would normally discuss matters like natural gas.

Mr. C. Evans: I thank the minister for that. Can the minister just provide a bit of an update on your Small Business and Corporate Planning Services for the past year? What type of projects have we seen? How has this part of the department been operating?

* (1550)

Mr. Derkach: Mr. Chairman, I think the member knows everyone at the table except, perhaps, for Mr. Ron Riopka, who is the director of Corporate Planning.

Some of the projects that have been undertaken by this branch of the department include such things as the rural economic renewal strategy. The member would know that the first rural economic strategy was developed as a result of a forum that was held a number of years ago. I am not going to quote a number, but it is about six or seven years ago, and the strategy was actually introduced about five years ago. In the forum this year, we looked at renewing the rural strategy, and the people who attended the workshops had input into, I guess, directing us as to what issues should be included in the new strategy, and that is what this branch is looking at right now.

We have also, under this part of the department, the Rural Advisory Committee to the Department of Rural Development. We continue to get input from the committee. They are the body that is spearheading the renewal of the rural strategy, and they were very much involved in the workshops that were held. We also have the land development issues under this branch of the department, and in this area the staff from the department have been very involved in the COSDI report. This is the group that looked at the whole issue of sustainable development legislation, so my department, through this branch, had input–as a matter of fact, some very direct input–into the issues as they revolve around our department with regard to planning.

The Capital Region, of course, the member is very much aware of that. This branch of the department has had direct input into the Capital Region and has been involved with the Capital Region Review Panel's work. Although the review panel is an independent group that is working outside of government and outside of our department, nevertheless the branch of the department that has responsibility is this branch.

This is also the branch that has been involved with such things as the annexations that the member has read and heard about around the province. I guess the most prominent of those was the Virden-Wallace annexation and the attempt to resolve the issue between the two municipalities through negotiations which this branch of the department was involved in. Unfortunately, that did not succeed, and so we had to revisit the Municipal Board order regarding annexation.

This branch of the department also is responsible for the legislation and regulatory changes as they relate to The Planning Act and streamlining The Planning Act as we did, the member knows, to ensure that we can move ahead with development plans in a much more effective way without the cumbersome nature of the process that we were experiencing before.

Also, the enhancement of technology in Manitoba is being handled through this branch, and specifically I am talking about the Manitoba Marketplace that was launched at the Rural Forum. This is an initiative that has been worked on very diligently by this branch of the department, and in addition to that, this branch also is involved with the regional Internet workshops that are being held around the province. The whole issue about this is to try and encourage and motivate greater usage of the Internet services that are available to all Manitobans.

Under the youth component, this branch also is involved with the rural youth forum with entrepreneurship and leadership through Junior Achievement. We also have the implementation in the work that has gone on with regard to the Brandon University's Master's in Rural Development program. That is a brand-new program that is just getting off the ground and one that we are looking forward to with some anticipation because we believe that future people who work in rural economic development will come out of this program, will be graduates of this program in the future.

In addition to that, the member may know, Pride of Manitoba, which is our youth group that acts as an ambassador group for our province, has been put together again this year, and this branch of the department has been responsible for co-ordinating the auditions and so forth to put this group together.

With regard to training programs that take place out in municipalities and the rural part of the province, once again this is the branch of the department that involves itself with this. Besides all of those responsibilities, the member knows about the Manitoba-Ukraine Memorandum of Understanding under the direction of Mr. Riopka. This is an initiative that this branch is undertaking. This is not a small initiative. It involves us carrying out the clauses of the memorandum of understanding with Ukraine. These are not easy because of the distances, because of the political climate in Ukraine which is changing. We believe there is a definite opportunity for people of Manitoba to do business with people in Ukraine because of the large number of people of Ukrainian descent in our province. This is a very positive thing I believe.

In addition to that, we participated in the CUBI event, and there is going to be a CUBI event, as I understand it, in Ukraine which we are being asked to participate in. Our responsibility in that regard is to work with the private sector to try and encourage businesses to participate in that CUBI event. Because of the presidential elections that are coming in the fall, we are uncertain as to whether or not the CUBI event will take place in the fall prior to or after the presidential elections, so that is still up in the air.

Additionally, we also have responsibility in this branch for the Nunavut Memorandum of Understanding between the Northwest Territories and Manitoba. As the member knows, we welcome the new territory of Nunavut. We were actually in Iqaluit the day that the Premier was selected and the day that the ministers were selected as well. It was a very historic occasion for us. It was almost by chance that we happened to be flying over from Rankin Inlet to Iqaluit about two o'clock in the afternoon when the Premier was selected. When we arrived at about six, the new ministers had just been selected. As I walked into the hotel, I will never forget this experience. Manitok Thompson, who was the minister in the Northwest Territories, came bounding into the hotel asking for me because she wanted to announce that she had been chosen as a minister in the new government. That evening they attended our reception, and it was just an historic event for us because the Premier himself, the Premier-elect himself, attended our reception and it was quite an occasion. So we have had responsibility for that part of, I guess, the government's work as well.

Those are some of the areas that this branch has responsibility for.

* (1600)

Mr. C. Evans: Just a few questions and comments on this. [interjection] I will. I am pleased to see that this department is dealing with these different projects and especially with the Ukrainian issue and Nunavut. It would have been a wonderful gesture on the minister's part to have made every effort to see whether his critic, for so many years, who had been so kind to him and his department, to at least let me know there was an opportunity if I wished to come along. I would have gladly have thought about it. It would have been nice. [interjection] It would have been nice. I am glad to see that the province is part of this initiative, both with Ukraine and Nunavut.

Two questions: the minister mentioned annexation and he mentioned Virden-Wallace. Are there any others that are going through the process within the province? I understand the R.M. of Gimli and the Town of Gimli are in discussions. Can the minister enlighten me on that issue?

Mr. Derkach: Mr. Chairman, through the year there are many municipalities that go through annexations and they are minor in nature. The reason I mentioned the Virden-Wallace one was because it was probably the most noted in the media as it related to a dispute between two municipalities on land issues.

There are others that resolve themselves in a very positive nature, and I would refer to the one example of Rhineland and Altona where the annexation was proceeded with in a very positive way. Although there are many that go on through the year, for different reasons they are resolved in different ways. I have a list here, annexation proposed or that are in process where, of course, I mentioned the Altona-Rhineland one. Roblin-Shell River, there is an annexation potential there. Cranberry Portage, Dufferin, Morris, the R.M. of Gimli and the Town of Gimli, and of course Carberry and North Cypress. Those are ongoing and discussions are continuing between the municipalities. We constantly strive to resolve those annexation issues through a co-operative and in a mutual way where municipalities, rather than going through that elaborate and long process, can agree to an annexation or can agree to share in some way where it does not involve the confrontational approach that sometimes occurs as was the case with the Virden-Wallace situation.

Mr. C. Evans: Obviously, the municipalities come to the department if there are problems or when they are going through the process of amalgamation or annexation. Why would the Virden-Wallace one, which I did not pay attention to that much myself, why would it have failed? Are there more issues than just land involved when it comes to these type of things? Taxes? Money?

An Honourable Member: Money.

Mr. C. Evans: I see that the member for Arthur-Virden (Mr. Downey) says "money."

Mr. Derkach: I guess the most prominent issue in an annexation is of course the loss of revenue to a municipality that is being annexed. There is also the whole issue of losing some potential revenue when a property is being annexed. So in the Virden-Wallace situation, what we tried to do was work between the two municipalities to arrive at a solution where there could be some annexation but also there could be some revenue sharing between the R.M. and the town on development that was bringing in significant revenue; in this case, it was to the R.M. However, that just was not a solution that we could arrive at.

I have to tell you that the department worked very, very hard. We did secure the services of a conciliator, if you like, or someone who could mediate between the two bodies, but at the end of the day the two groups decided to see it differently, then proceeded to the Municipal Board. At the end of the day the Municipal Board did make a ruling which we supported. I think to be honest with you, if the two municipalities had to do it again, they would probably try to resolve their issues in a different way, and that is my opinion.

Mr. C. Evans: The minister also indicates here that part of the department serves as a secretariat, and we talked about this last year, about the Provincial Land Use Committee of Cabinet. Could the minister just update me as to how often this committee meets and who is directly on the committee? If it is a long list of ministers, then I would appreciate it, and some of the activity in the last couple of years that this committee has had to indulge in.

Mr. Derkach: Mr. Chairman, the Provincial Land Use Committee, which I chair–this branch is secretariat to the committee–involves itself with such as things as appeals on Crown land issues that come before government. What we do is that, if there is an appeal on a sale of Crown land, then that matter comes before the Provincial Land Use Committee for a decision. The Provincial Land Use Committee makes that decision, and that decision is forwarded to the cabinet for approval. That is sort of the process.

We also, Mr. Chairman, have a complement of ministers at the table who represent the various interested departments that might have some interest in the issues, and they are basically the Department of Agriculture, the Department of Natural Resources, the Department of Highways and Transportation, the Department of Northern and Native Affairs, the Department of Urban Affairs, the Department of Industry, Trade and Tourism, and the Department of Environment.

Mr. C. Evans: So it is on appeals for land sale that this committee, or is it application for sale of Crown land? Would a producer or a landowner or a producer who is leasing land, would their request to purchase Crown land, leased Crown land, go through this committee at all?

* (1610)

Mr. Derkach: Mr. Chairman, the Provincial Land Use Committee of Cabinet establishes the policies as they relate to Crown land sales. The Crown Land Classification Committee then implements the policies that are established for the Provincial Land Use Committee. If they are under the set of policies, there is a process which is followed for an individual purchasing Crown land. Now, if the Crown Land Classification Committee turns down a particular sale of Crown land, an individual may appeal that directly to the Provincial Land Use Committee. The committee then will establish whether or not to proceed with the sale.

In addition to that, the Provincial Land Use Committee of Cabinet, which meets quarterly, also establishes, if you like, the policies as they relate and works on legislation as it relates to land use. This committee has also been instrumental, and the secretariat to this committee has been instrumental, in the whole issue of revisions to The Planning Act, revisions to the land use policies, and the input into the new Sustainable Development Act as well.

Mr. C. Evans: Unless somebody appeals a proposed purchase or somebody who has requested and been turned down and goes and appeals, that is basically what would come before this committee. The minister also says that it has some policy mandates or support that would be provided through Order-in-Council I guess or through regulations. So any changes that would be proposed by any department on land use planning would also go before this committee and these ministers to agree to or to change. Is that what the minister is saying?

Mr. Derkach: The reason that we have the various departments around the table is for input into various policies or various approaches that are taken. Indeed, if there is an issue that comes before the committee, the input of these departments is very important. Even in the case of appeals we seek the input from various departments as they relate to that particular appeal that is before the committee.

The Acting Chairperson (Mr. Helwer): 13.3. Small Business and Planning Services (a) Corporate Planning and Business Development (1) Salaries and Employee Benefits $690,800 (2) Other Expenditures $109,900 for a total of $800,700–pass.

13.3.(b) Small Business and Community Support (1) Salaries and Employee Benefits $216,400.

Mr. C. Evans: Could the minister just very briefly, just an update on this Small Business and Community Support Branch, what has the activity been in the last year with this?

Mr. Derkach: This is a very busy branch of the department. The goal of this particular branch is to try and stimulate economic development through various means in rural Manitoba. Over the course of the last year this branch has conducted a series of seven marketing seminars as part of the marketing marathon at Rural Forum '99. Seminars were targeted to about 300 participants to increase their marketing knowledge in a number of areas. It also developed a marketing camp for 30 to 50 participants. The marketing camp has not yet been held but will be held over a two-day period of time. It will give opportunity to participants to develop and complete marketing plans for their own businesses.

In addition to that, a series of seven marketing seminars will be held during Small Business Week in October 1999. These will be targeted at about 200 participants. The Community Newspapers Association will also partner with the department in delivering these seminars in seven rural communities around the province. This branch also provides marketing assistance to clients on a one-time basis as required. In addition to that, during Small Business Week this branch will also co-ordinate a tour for the minister. The tour will provide interaction with publishers and editors and the public in rural Manitoba.

Marketing assistance is also provided by this branch to the Manitoba-Ukrainian secretariat. In addition to that, the forum is something that this branch also works at and supports. It continues to market and promote the effective communication between different segments that the department works on, whether it is the Manitoba-Ukraine MOU or the Nunavut-Manitoba MOU or the Northwest Territories-Manitoba MOU. We produce the community or the rural development's newsletter that goes out to rural Manitoba on a semiannual basis. This year it is on a semiannual basis. I think previously it has been on a quarterly basis. This branch will also undertake to work with the Manitoba Association of Community Newspapers to, in a positive way, I guess, give some indication to Manitobans how we as a department could partner in a positive way with businesses and rural Manitobans to enhance their communities, to sustain their communities.

I would say there is probably a new challenge out there for this branch of the department as it relates to western Manitoba and the situation that is existing there today. This branch of the department also prepared a booklet of success stories that involved rural partners in Manitoba, and this booklet will be distributed to about 5,000 stakeholders in the province. This is going to be a 50- or 60-page booklet, and it will be developed in consultation with rural Manitobans. It will include anecdotal stories, photographs, graphics, illustrations to try and motivate Manitobans in the rural part of our province to seek solutions to the challenges that they have before them.

The list goes on, Mr. Chairman, and I could go through it all. I am going to try to just hit the high points if I may. This branch also works with Rural Junior Achievement to develop a business and marketing plan and complementary information pieces to enable Junior Achievement to launch their ongoing initiative that will help to generate revenue for them, because as the member knows we are also trying to work towards more self-subsistence, if you like, or sustainability by the Junior Achievement organization as well.

The other area I think that should be noted is the support that this branch gives to the sustainable economic renewal strategy, which will include the output of about 5,000 copies of the new strategy document to rural development stakeholders to let them know what our new strategy is and to communicate with them. It also continues to promote and support the expansion of the Manitoba Marketplace Supply Enhancement Initiative, including the development of promotional materials as they relate to the Manitoba marketplace. The uptake of this particular initiative has been very, very good, and the reason for that I think is because there is an awareness that has been created through this branch in rural Manitoba about this initiative.

We also developed through this branch a communication strategy for a series of Internet workshops, as I mentioned before, that were spearheaded and approved by the Rural Advisory Committee, including a public relations and promotional material campaign, if you like, or the promotion of this kind of activity in rural Manitoba.

* (1620)

We also provided through this branch the support that was required for Pride of Manitoba to do a bit of their marketing for the Rural Forum, and also so that rural Manitobans would know that they are indeed able to have Pride of Manitoba at various functions across the province which are held throughout the summer. This is a very important event, because as we approach the millennium, we need good ambassadors for us as a province I think to promote our province in a very positive way.

This branch also assists in the design and the co-ordination of the Municipal Officials Directory, which is something we are mandated to do; in addition to that, the design and co-ordination of our statistical information publication, as well as the administration seminars handbook; and the planning district manual, which is put out by the department, so, once again, a very busy branch of the department, a very essential one, I might add, and one that has been used by many communities and many organizations, including our municipal organizations, to assist them with the work that they do in promoting themselves as well.

Mr. C. Evans: Is this also the part of the department that deals with the Rural Forum itself, and how much costing this year?

Mr. Derkach: Yes, and the director of this branch, I should have introduced him previously, is Mr. Paul Staats, who is the director of our Marketing Branch. I would like to also present to my critic a copy of some of the materials that have been worked on by this branch, which includes, there is a video, there is a cassette. Last year I think I presented the critic with a cassette or a disk that was produced by the Marketing Branch as well. So I am pleased to do that for the critic.

Mr. C. Evans: I appreciate the package. I will certainly go through it. I would rather have gone on the trip to Nunavut.

Can the minister just indicate the cost, this year's cost–I mentioned in my opening statement that I was pleased with the Rural Forum–what our costs were this year and, you know, break even, do good, bad?

Mr. Derkach: I guess in answering this question I would like to just provide a caution that the numbers are subject to change, because they are not all in at this point in time. So there could be a minor change to the numbers that I give here this afternoon. But the total for the 1999 Rural Forum would be $434,790. That includes contributions from ourselves and also from sponsors and partners in the forum. The cost to our department for the forum is approximately $175,000. The remainder of the money comes in from partners and sponsors.

Mr. Chairperson: Shall the item pass? The item is accordingly passed. 13.3.(b)(2) Other Expenditures $68,600–pass.

Resolution 13.3: RESOLVED that there be granted to Her Majesty a sum not exceeding $1,085,700 for Rural Development, Small Business and Corporate Planning Services, for the fiscal year ending the 31st day of March, 2000.

13.4. Local Government Services (a) Executive Administration (1) Salaries and Employee Benefits $122,600.

Mr. C. Evans: If I can ask the minister if under this Local Government Services line if we can discuss tax sales within the province and within municipalities. Under Local Government Services, can we discuss an issue of tax sales?

Mr. Derkach: Yes, Mr. Chairman, we would certainly entertain those questions.

Mr. C. Evans: The minister had received correspondence about a tax sale and the questioning of the tax sale because it was being bought by a municipal employee. The minister remembers, I raised this with the minister, and I would have thought that The Municipal Act in place would actually have covered the concerns. Did the minister not write back to the person who wrote saying that you will have to take it through the legal system? Is that not what the response was by the minister's office?

Mr. Derkach: Mr. Chairman, I guess the process is that the legislation is there as it is written, and our responsibility is to try and make sure that the legislation is as soundproof as possible. However, if someone feels aggrieved, then he or she has the responsibility to take that matter through the court system if, in fact, they feel that they have been wrongly done by.

I think the member is probably talking about a situation that occurred last year with regard to tax sales in the Cartier municipality and some municipalities in southern Manitoba as well. As a result of what was taking place, we reviewed the regulations and the legislation and decided to make some amendments to try and deal with those situations so that they would not continue. So amendments were made with regard to those issues, through regulation, and we also assured the municipalities at that time that we would be bringing amendments to the act to deal with those issues, and that is what we have done in this session to try and deal with those issues.

Now, no matter how tightly we try to write the legislation, there may always be a situation where a person feels aggrieved by the way he or she is treated through a municipality in a tax sale situation. So, in those cases, we always encourage people to ensure that they have avenue through the courts to resolve those kinds of issues.

Mr. C. Evans: Then the minister is saying that this person is wrong in their letter to him in citing the act itself in the letter to the minister. Obviously, the person who wrote the letter did their homework. It is a letter dated March 5, 1999, the letter I presented to the minister here in the House asking him why nothing had been done about this. There are four paragraphs that refer to sections of The Municipal Act, that there is conflict of interest, that land was sold illegally or against the act, a conflict of interest. I am sure the minister has dealt with it.

* (1630)

I am basically asking is this person wrong in what they have stated in their letter to him, and is the minister right in saying you have to go through the legalities of all of this? I mean, now you are trying to say that there are ways of slipping through The Municipal Act after we have worked so hard and everybody has worked so hard in putting a new act together, that now there are loopholes and now we are going to correct them again.

I know there is always going to be changes to something. If he wants, I can provide a copy of the letter and he can read and then tell me whether this person is wrong. If they are, then we will deal with it.

Mr. Derkach: I think what the letter is suggesting is that there be direct intervention by the minister into this matter. Regardless of whether it is this issue or any other issue as it relates to The Municipal Act, if a party feels that the act has been broken through an action of the municipality or someone in the municipality, then the way to correct that is through the court system. It is not for a minister to come in and try to dictate to a municipality or anybody that indeed they have broken the act. It is up to the individual then to take the matter, because the act has been broken, through a court process.

I do not have a copy of the letter in front of me, Mr. Chairman. I would like to ask the member if he would table it. Then perhaps I could give a more detailed response. With regard to the changes to the act that we are making now, we are simply enshrining in legislation what we had passed as a regulation so that it would be clearer to everybody as to what the intent of The Municipal Act is.

Mr. C. Evans: I think once the page brings a copy we can–I did make a copy for the minister because I was contacted saying that there has been no reply to the letter. I remember giving him a copy in the loge. Then I believe I received a copy of your letter saying, well, you will have to go through the legal system.

It cites conflict of interest; it cites an administrator from the R.M. of Tache selling land twice, I believe, under the act and under the sections that are being cited by the person that it was wrong. I want the minister to see that and look at it again and tell us here today that that person that wrote you the letter is wrong in what she is saying. So I guess it will be best that we deal with it.

If there is a loophole or somebody has done something that they are not supposed to be doing, then I think that we should take some action. An act is an act. The regulations are there. The act is there. Why are we then saying, well, this certain part of the act, there is a loophole, so if you do not like it you go to court with it?

Mr. Derkach: Mr. Chairman, I think this is probably a little more complex than it appears on the surface. To begin with, as I understand it, the letter is coming from someone who does not have a grievance or an interest in a piece of property him or herself. Rather, this individual is grieving the process and the way that The Municipal Act was structured to begin with.

Now, this was not necessarily a change from the old act. The change was made to The Municipal Act in terms of allowing for the sale of property and that the sale would be final. The act did not say who could purchase or who should not purchase property. So when the issue came to the department that employees of a municipality were purchasing property for very low prices compared to the value of the property, that became a red flag to the department.

So we passed a regulation that disallowed people who were direct employees of a municipality, it excluded them from the purchase of property. The regulation was passed and was given to municipalities. However, it was just about at the same time that some of the property was being sold in a tax sale. So this individual who writes the letter is suggesting that the regulation was contravened, not the legislation but the regulation that was passed, and this was a timing issue. That is why the response to this individual was that if the party who feels aggrieved by this action wishes to, he or she may take this matter before the court to get a clarification and to get an understanding of whether or not, in fact, the regulation was contravened.

In this case, we have not heard from the owner or the person who owned the property previously. Rather, this is a third party who is writing to us, and this letter was responded to, and I would be happy to provide the member with a copy of the response that went to the individual.

Mr. C. Evans: I have one. I was sent a copy of your letter back.

Mr. Derkach: Oh, I thought you said that I did not–[interjection]

Mr. Chairperson: Are the members just carrying on a conversation, or do they want to come through the Chair, because I do not know which mike to turn on anymore.

Mr. Derkach: Mr. Chairman, just for the record, this letter that was received from the individual was responded to on May 19, and I do not believe that I have had a letter since then.

* (1640)

Mr. C. Evans: So, basically, the minister is saying it is a dispute over the facts, but by saying that, he is saying that the person is not right in referring to and stating that under such and such a section this cannot be done? Is he saying that?

Mr. Derkach: Well, Mr. Chairman, I guess what I am saying is that under the existing former Municipal Act, there was no indication of who could or could not buy a property when it was going for tax sale. There was an assumption that employees and municipal elected officials would not be allowed to buy property directly as it came up for tax sale, and this was flagged to us as an issue. We passed a regulation which would deal with this situation for a short period of time until we could pass legislation.

What we are doing now is enshrining the regulation in legislation to make it very clear to all municipalities that this, in fact, is the law. Now, if someone contravenes the legislation after it is passed, then it would be up to the department to take action, so the issue that is raised here by the writer of the letter is not necessarily incorrect. However, the individual is raising the issue of the fact that we had passed the regulation and that there seems to have been a municipal official not following the regulation. After investigation, as I pointed out, there was a timing question, and so that is what is at issue here. If there is a question with regard to interpretation or timing, that is a matter that the individual who is aggrieved would have to take before the court.

Mr. C. Evans: I am okay with that one, Mr. Chair.

Mr. Chairperson: 13.4. Local Government Services (a) Executive Administration (1) Salaries and Employee Benefits $122,600–pass; (2) Other Expenditures $34,600–pass.

13.4.(b) Assessment Services (1) Salaries and Employee Benefits $6,013,700.

Mr. C. Evans: Can the minister just remind me, help me out here as far as the assessment years? In what stage are we with the reassessment and the tax issue?

Mr. Derkach: The last assessment was in 1998, and we are on a four-year cycle. The next assessment will be in 2002.

While I have the mike, I would like to introduce Mr. Ken Graham, who is the director of Assessment Services in the Province of Manitoba.

Mr. C. Evans: Have there been many changes in this department in this area in the past year? Have there been any major assessment proposals or anything to be changed that we may foresee in the next assessment? Is there anything in the plan, in the works?

Mr. Derkach: I guess the work for the Assessment Branch is ongoing, and between reassessment periods, the branch has to ensure that the reinspections are done on a timely basis for all of the properties in rural Manitoba. There is a schedule that the branch has that they follow in order to do reassessments in an orderly way.

In addition to that, they also work on issues as they arise with regard to assessment, and they also work on providing recommendations for legislative amendments to assessment so that, indeed, our assessment process is as current as it can possibly be.

We also consult with other jurisdictions in Canada to ensure that changes in other areas that are reflective of property values are indeed ones that are taken under consideration when we do our policy re-evaluation in this province.

In addition to that, I should also add that the branch produces an annual assessment roll for each municipality in the province.

Mr. C. Evans: It states here: Public Schools Finance Board requirements will be met annually. Can the minister explain that to me?

Mr. Derkach: In order to arrive at a proper funding mechanism and approach for school divisions for a particular year, they require an assessment of all school divisions. The Public Schools Finance Board requests of our Assessment Branch that information on an annual basis. So this is what we do for the Public Schools Finance Board for total school assessment in the province of Manitoba.

Mr. C. Evans: One last point, I did sort of refer this and ask if there were any changes. It does state that assessment reform measures will continue to be introduced. So the department is always looking at some ways to improve the assessment measures, basically always going through a process of trying to make it a lot easier for the municipalities and government and individual residences and businesses in the communities.

Mr. Derkach: The branch has a continuous improvement initiative that it embarks on or has embarked on to ensure that all of the issues as they relate to assessment are as current as they possibly can be. We also try to provide through the branch a better information package to our municipalities and to individuals. On that issue we have actually implemented open houses in municipalities to give us accurate and as current information to taxpayers and to municipalities as is possible. The open houses have been very successful.

In addition to that, we are updating our computerization systems to ensure that we can deliver the services in the most effective and efficient way. We also, as the member knows, have brought in an amendment to the Assessment Act to ensure that our Assessment Act is current and is as up to date as we can possibly make it.

* (1650)

There is a lot of activity that takes place in this branch. I do not have to explain to the member how important this branch is to the taxpayers of our province. It is a very sensitive area where taxpayers react very quickly if there are errors or if there are issues. That is why we have instituted the open houses, because we think we want to be a department and a branch that is client oriented, that is service oriented, and that we provide the best kind of service we can to our clients out in rural Manitoba.

I would have to say that I think it is reflective of the low numbers of assessment appeals that we have in rural Manitoba today. I think we are down under 2 percent, if I am not mistaken, which is probably the lowest that we have ever seen it.

Just as a bit of information, under this branch we add about approximately $200 million of apportioned assessment to the rolls every year, which involves about 6,000 properties on an annual basis.

So the branch does really put a very concerted effort into ensuring that our assessment values and our assessment of property are as current and up to date as we possibly can be. We have to make sure that we understand that we are talking about rural Manitoba here, because in the City of Winnipeg, there is a separate Assessment Branch, which is operated by the City of Winnipeg, not by the province.

The Acting Chairperson (Mr. Helwer): Item 13.4.(b) Assessment Services (1) Salaries and Employee Benefits $6,013,700; (2) Other Expenditures $1,359,000, for a total of $7,372,700; (3) Less: Recoverable from Education and Training $(l,843,200).

Mr. C. Evans: Just quickly, the Recoverable from Education and Training, it is an annual amount given to the Department of Rural Development. Is that for part of the training process within the department?

Mr. Derkach: Mr. Chairman, we recover approximately 75 percent of assessment costs from municipalities. Because of the education portion, we recover about 25 percent from Education, and this is the recoverable portion from Education.

The Acting Chairperson (Mr. Helwer): 13.4.(b)(3) Less: Recoverable from Education and Training ($l,843,200), for a subtotal of $5,529,500–pass.

13.4.(c) Local Government Support Services (1) Salaries and Employee Benefits $922,300; (2) Other Expenditures $242,100; (3) Transit Grants $1,562,600; (4) Municipal Support Grants $973,400, or a total $3,700,400.

Mr. C. Evans: Just two very short questions, if the minister can just provide me with the answer to the "Administration of the property tax credit program will result in rebates of approximately $65.0M for the Manitoba Resident Homeowners Tax Assistance Program being processed." How does that work within your department? What does it exactly mean?

Mr. Derkach: The property tax credits, Mr. Chairman, is something that we administer for the Department of Finance, so we recover the costs of that from the Department of Finance. I am sorry, we do not recover it.

The Acting Chairperson (Mr. Helwer): 13.4.(c) Local Government Support Services.

Mr. C. Evans: Just one quick question on the Municipal Support Grants. I see that it has gone down somewhat an amount. Why have we dropped in that department?

Mr. Derkach: Well, Mr. Chairman, as the member knows, there was a commitment made by our government to increase the payroll tax exemption from $750,000 to $1 million. Based on the projected payroll costs, there are two municipalities who will no longer be responsible for the payroll tax. They are the R.M. of Portage la Prairie and the R.M. of St. Andrews.

Mr. Chairman, I should introduce Mr. Larry Phillips. I do not know whether he is familiar to the critic. Mr. Larry Phillips is the manager of our Information Technology branch in the department.

The Acting Chairperson (Mr. Helwer): Thank you. We will carry on. The total then for 13.4.(c) Local Government Support Services $3,700,400, Less: Recoverable from Rural Economic Development Initiatives ($75,000) for a subtotal of $3,625,400–pass.

13.4.(d) Grants to Municipalities in Lieu of Taxes (1) Grants $13,529,500–pass; (2) Less Recoverable from other appropriations ($13,375.9) for a subtotal of $153,600.

Mr. C. Evans: Mr. Chair, just a quick explanation on that for the record. From other departments, whatever the other departments that have land or buildings or whatever, municipalities that are being assessed, do they then provide Rural Development with the money and then in turn it is provided back to the municipalities? Is that how that works?

Mr. Derkach: What happens is departments in government are responsible for their own grants in lieu. What we do is we pay on their behalf and then recover from those various departments.

The Acting Chairperson (Mr. Helwer): We will move on for a subtotal on 13.4.(d) $153,600–pass.

13.4.(e) Information Systems (1) Salaries and Employee Benefits $801,500.

Mr. C. Evans: The Manitoba Assessment Computer System and the Board of Revision Assessment Support System, that program, is that centralizing basically our assessments? Is that for the whole province? Is it based on two locations under two different divisions? If it was in place before, I am sorry if I have not asked about it but I would just like some information on those.

Mr. Derkach: We do have a centralized data system, an assessment system in the department and we do it on behalf of the municipalities. It is the MACS system that we have, the system that is in place right now where we keep all of the information. The BRASS system which includes the central database does provide for us an opportunity to be able to take the information from the MACS system down to PCs so it can be more user friendly, if you like, for our people who work in the field and also for our municipalities.

* (1700)

Mr. C. Evans: I just want to make a comment on that. I would like to sometime soon have a look-see with the minister as to how that all works and exactly how it is operated, because I am computer illiterate and it would be interesting to see exactly how things are saving us money, so I ask that.

Mr. Derkach: I would be happy to spend some time with the critic and take a tour of the assessment area, for that matter, and show the member sort of the workings of the system. So it would give him some appreciation for what this branch really does get involved in in terms of helping municipalities ensure that their information is current and up to date.

The Acting Chairperson (Mr. Helwer): We will move on.

Item 13.4.(e) Information Systems (1) Salaries and Employee Benefits $801,500–pass; (2) Other Expenditures $1,518,200–pass, for a subtotal of $2,319,700; (3) Less: Recoverable from Education and Training ($424,200), for a subtotal of $1,895,500–pass.

RESOLVED that there be granted to Her Majesty a sum not exceeding $11,361,200 for Rural Development, Local Government Services, for the fiscal year ending the 31st of March, 2000–pass.

13.5. Rural Economic Development (a) Executive Administration (1) Salaries and Employee Benefits $122,600–pass; (2) Other Expenditures $32,600–pass; for a subtotal of $155,200.

13.5. (b) Infrastructure Services (1) Salaries and Employee Benefits $1,565,000.

Mr. C. Evans: I would just on this line like to ask what projects are in place or going to be in place this year. I have an issue I want to run by the minister. I do not know if this is the appropriate line. There is a situation in the community of Riverton where there are a few businesses and a few homes that are not tied into the town sewer and water system. They have been looking at, requesting the village and the town to, of course, hook up, and there is quite a cost to the individual homeowners and business people. I am just wondering, I do not know as yet as to what the village of Riverton has done to this request. The folks have come to me to see if there are monies available through Infrastructure, through Rural Development that perhaps the community can access and individual owners of the homes and businesses can access to be able to tie into the main line.

Would this line be able to provide any information for us on that?

Mr. Derkach: What we do is we work with municipalities to identify their priorities. What we do is put their list of priorities on a five-year program so that we can address the issues the municipalities have with regard to infrastructure water and sewer on a timely basis as best we can. The member might appreciate the fact that we have far more demands than we have resources to be able to meet those on an annual basis. That is why we have asked for the five-year plan for municipalities. I do not know specifics of the matter that the member brings forward, but I would be more than willing to sit down with him and look at the details and have our Water Services Board address the issue. We try to do that on a priority basis.

There are from time to time emergency situations or situations which arise which were not expected. We try to address them as best we can, but it does mean that we have to set aside a project here and there from time to time to accommodate those. So I would be pleased to look at the issue and see whether or not we can address it through the Water Services Board.

The Acting Chairperson (Mr. Helwer): 13.5. Rural Economic Development (b) Infrastructure Services (1) Salaries and Employee Benefits $1,565,000–pass; (2) Other Expenditures $459,300–pass; for a subtotal of $2,024,300.

13.5.(c) Community Economic Development Services (1) Salaries and Employee Benefits $2,955,600–pass; (2) Other Expenditures $766,100–pass; (3) Grants $545,000–pass; for a total of $4,266,700.

13.5.(d) Food Development Centre $912,400–pass.

Resolution 13.5: RESOLVED that there be granted to Her Majesty a sum not exceeding $7,358,600 for Rural Development, Rural Economic Development, for the fiscal year ending the 31st day of March, 2000.

Mr. C. Evans: I wonder if the minister would agree to a five-minute recess. I would like to complete the Estimates today, if we could get a five-minute recess and do our very best to try and get through the process until 6.

The Acting Chairperson (Mr. Helwer): We will take a five-minute recess. Is it the will of the committee that we take a five-minute recess? [agreed]

________

The Acting Chairperson (Mr. Helwer): We can call the committee back to order. We are on Resolution 13.6. Rural Economic Programs, for a total of $21,000,000 (a) Grow Bonds Program (1) Salaries and Employee Benefits $471,100. Shall the item pass?

Mr. C. Evans: Can I ask some pertinent questions? I know it is the Grow Bonds, but on natural gas. As the minister is aware and I am sure the government is aware, the co-operative that was formed–

Some Honourable Members: Oh, oh.

The Acting Chairperson (Mr. Helwer): I wonder if those members who want to carry on a conversation could do it in the loge, please.

* (1720)

Mr. C. Evans: On a point of order, Mr. Chairman, if as he has indicated, that if there are conversations, otherwise in the Rural Development Estimates, that they be done in the loge in Ukrainian?

The Acting Chairperson (Mr. Helwer): The honourable member does not have a point of order.

Mr. C. Evans: Mr. Chairman, to continue, the minister is aware, the government is aware there are plans for rural gassification in the Interlake area. They are hoping to get started I guess this coming year. There have been a lot of drawbacks. I would like to sort of find out how much involvement Rural Development has had in the gassification for our area and what type of resource commitment is there from the government and from Rural Development? Is the department encouraging, not pushing the municipalities to do something that they do not want to do, but encouraging? Are they part of the plan that has been put together by the municipalities that are part of this co-operative?

There have been lots of negative issues come out of this. I have been at meetings. I have heard lots of people very, very strongly opposed to gassification. Individuals, it is unfortunate. I do not know how much homework has been done on this issue, but I would like to know where the minister and his department is with this and the government as far as Interlake's co-operative for natural gas?

Mr. Derkach: Mr. Chairman, as the member probably is aware, we as a department have provided two feasibility study grants to the co-op to undertake some work in preparation of natural gas in the area. In addition to that, we worked alongside with departments in government and the Economic Development Board staff and the municipalities involved in this co-op to put together a process and an approach to the delivery of natural gas services in the area. In that regard, the government of Manitoba has committed $2.35 million towards this project. The total cost of this project is estimated to be approximately $7.9 million in the first phase of course. So through our staff and the Economic Development Board, we have been in consultation with the co-op, and basically it is in their ball court, as I understand it, to proceed beyond this point in time.

I should also introduce a member of the Economic Development Board staff who has joined our table. It is Mr. Jonathon Lyon who is a senior project officer with the Economic Development Board and who has been involved with the natural gas projects not only here but also in the Swan River area as well, and others, La Broquerie and others.

Mr. C. Evans: I do not know where to start on this issue as far as trying to get some support. I know that it is the commitment of the communities involved, as the minister is well aware, and Mr. Lyon is aware, I am sure, that over the past I think it is five years we have gone from feasibility studies to forming this co-operative and municipalities opting out in phase one and phase two. Really, it seems that the people in the co-operative think that it is going, yet I am not hearing anything positive that it is for sure. The first phase itself, is it in the works for the start of next year? I think they wanted to start it last year for phase one. I know that the communities in my area specifically are part of phase two. Where is phase one? Is it there?

Mr. Derkach: I am informed that this project is before the Public Utilities Board and the ruling is to be coming out very shortly on this project. If the ruling is positive, then work can proceed this year. However, if the ruling is less than positive, then it is back to the drawing board, I guess, to address the issues that might be put on the table by the Public Utilities Board. That is where the project is at. Our money is in place as a government. We are not reneging on the commitment that we have made. Certainly we are looking forward to the implementation of phase one.

I might say to the member that my goal and my hope would be that we can gassify all of rural Manitoba as was done with electrification back in the '50s because I think in this day and age natural gas is an absolute requirement for communities to be able to progress, to sustain themselves, and to proceed into the new millennium in a very positive way. As we can afford it, and as communities can afford it, we will work very positively with them to enhance natural gas into the communities. With the recent announcement with Manitoba Hydro acquiring Centra, I think that provides a lot of optimism and opportunity to be able to do just that in the course of time.

I also would like to introduce the assistant deputy minister responsible for the economic development side of the department, Mr. Larry Martin, who has also joined us at the table.

Mr. C. Evans: I guess to provide the minister with what I am hearing out there and getting is that people are very upset that municipalities and communities have assessed through the system, put an assessment through to realize tax dollars for future influx or input of natural gas on the people themselves, on the individuals. Now, those individuals that are okay with the project do not have a problem with it. I am sure the minister is aware of this very large proportion of the Interlake that is against the natural gas proposal, maybe not against the proposal itself but the way it is being handled, that is, allowing the municipalities to take a certain amount on their taxes providing the future money for, what people are saying, natural gas that is not going to be able to come to their place or it would be too much of a cost to bring natural gas to their farmyard or their farm home or whatever.

I do not know how the committee is dealing with that. I just wonder, the minister said there is $3-something-million committed by the government. This is phase one. [interjection] Sorry, 2.3 committed and that is the phase one. Is there any commitment or has there been any negotiation to commitment further than that for any funding available? I guess what I am asking is for some support from this minister because we talked about it in opening remarks how important gassification can be for rural Manitoba and to rural Manitoba for its future economic development. I am wondering if there is not a way that we might be able to assist in sending the message out there to the communities. So many of the municipalities that were involved from the beginning have dropped out, very vital ones, important ones. There were users in their municipalities. Unfortunately, for now, they have opted out of the program and put themselves on hold as being part of it. I guess I just look for some input from the minister. I know he wants to see that. But what can we do?

* (1730)

Mr. Derkach: I guess a couple of points that need to be made is that we have been in touch with the municipalities. They understand the approach that is being taken and that the province's money is on the table. The municipalities, through consultation amongst themselves, decided that they would take the approach of the phase one/phase two for gassification in the Interlake. There was no pressure put on any municipality that they had to forgo any monies that were allocated to them through the federal program. But, it was through a mutual understanding that in order to accomplish the goal they would have to do it in phases. Now, we do not know what the Public Utilities Board is going to rule, but I believe that municipalities, because we have been in touch with them, understand that if the PUB rules in favour of the co-op, they will proceed immediately with phase one.

Now, the member also asks about where we are at with phase two. I would have to say that phase two is a concept at this point in time. There has been no allocation of dollars to phase two at this point in time by municipalities or by government. We will have to approach that issue once we are through the first phase of this large project.

With respect to individuals being able to hook up to natural gas, I guess, it is not different from other projects that we have been able to achieve in that not everybody who lives in a particular area is going to have natural gas service provided to his home or to his farm. That would be the ultimate goal, but I believe that we are working towards that.

But what is more important is that natural gas in a community or in an area provides for the potential of having an industry or perhaps a user, a high user of natural gas, who can add to the economic development initiative of an area. It gives that community the ability to attract those potential customers, if you like, or developers, or economic projects to an area. Without natural gas, you simply cannot do that.

I think the case in point here is Louisiana-Pacific in Swan River which has been attempting to secure the natural gas service for their own use so that they can compete on a world basis. Without that competitive advantage, you simply cannot be in the marketplace, and it stymies the ability of that plant to be able to add value to the products that they are producing now, perhaps add to the plant. So that is why it is very critical for an area to receive that.

So, although municipalities in the Interlake may not all be able to have access to gas immediately, what it does for the area as a whole is it gives it the level playing field to be able to compete for businesses that perhaps are looking for a home somewhere in rural Manitoba. That is our goal, too, to try and ensure that we give every area the same advantage in being able to attract business to its area.

Mr. C. Evans: I agree with the minister on his comments. It is something that I know I have been a part of in getting to the area since 1989, since I have been a part of the municipal system and part of the whole program and been in place with a lot of the meetings. It is, I think, there just was not enough information provided to those people who are all of a sudden saying: I am not going to be able to get it. Why am I paying $1,000 or $2,000 over a period of time so that this little community can get it or that business can get it type of a thing?

The other problem, I think, too, is the vastness of the area where communities are few and far between as further north you go. In the southern portion of the Interlake, where phase one is, there is better access to being able to provide it. That is my belief, anyhow. I think that is what the study shows.

I was very encouraged at one time to see that it was progressing at its level, but it seems now that there is so much unsureness about it and cost and everything else that some people are shying away from it. Hopefully, they will not shy away from it in a forever kind of thing, and just forget about it altogether, and just be complacent with the fact that what they have got now is all that they will get. Hopefully, there is something that can be put in place, that natural gas can be provided for, as you say, as many communities as possible.

I do not mean to be critical or negative to the point, but north of the Perimeter, the rural area north of the Perimeter, needs some sort of an economic input and support, and the further north we go, to be able to maintain the communities and maintain economic development. So I just sort of look for the minister's support on that. Hopefully, if phase one can get going and be passed, it will be able to provide the other communities with–you know, they will be able to see just what it is going to do for that part of the community and perhaps change their opinions of it.

I appreciate the opportunity just to make those comments on the natural gas issues.

The Acting Chairperson (Mr. Helwer): Okay, we will move on to 13.6. Rural Economic Programs (a) Grow Bonds Program (1) Salaries and Employee Benefits $471,100–pass; (2) Other Expenditures $623,700–pass, for a subtotal of $1,094,800.

13.6.(b) Rural Economic Development Initiatives (1) Salaries and Employee Benefits $490,900–pass; (2) Other Expenditures $1,44,100–pass; (3) Programs - Operating $6,894,400.

Mr. C. Evans: It says here "decreased funding under this appropriation reflects the re-allocation of funding amongst the various Rural Economic programs." What is the re-allocation? What has changed? It is not a major drop of resource, but it is a drop.

Mr. Derkach: Mr. Chairman, some of the changes are a result of less demand for program dollars in those areas. I would reference the Community Works Loan Program, where many of the communities are already in the program, so those that are left to join the program are fewer, and so there is projected to be less call on the dollars in that particular program.

I guess if you were to look at the other areas, for example, the Development Support Program, in that we are anticipating less takeup of the program than there was previously. So those are just the adjustments in an overall sense. I think the biggest drop is in the area of the Community Works Loan Program, and I have explained that already, and Strategic Initiatives as well, where we are anticipating less demand for it. So there is a bit of a decrease in the amount.

At the same time, I would have to tell the member that we are fully committed to realizing the commitment that was made under such projects as the Maple Leaf plant in Brandon. Certainly, that takes a fair chunk of money, just the one project alone, so therefore it is a reallocation of dollars as well.

* (1740)

The Acting Chairperson (Mr. Helwer): 13.6.(b)(3) Programs - Operating $6,894,400–pass. (4) Programs - Capital Grants $6,375,800.

Mr. C. Evans: Just a comment, so then as we see the decrease for the previous line for allocation and need, I would guess that the increase in this line would be for more need for Capital Grants to be made available.

An Honourable Member: Maple Leaf.

Mr. C. Evans: That is Maple Leaf. Is that what the minister is saying?

Mr. Derkach: Yes, that is what the major projects are taking up, a fair chunk of capital money, and it is spread over more than one year. But as the member knows, there is a call for that money this year.

The Acting Chairperson (Mr. Helwer): 13.6.(b)(4) Programs - Capital Grants $6,375,800–pass; for a subtotal of $13,905,200.

13.6.(c) Unconditional Grants - Rural Community Development $6,000,000.

Mr. C. Evans: The formula has not changed then. I see the monies are the same. Is the formula the same pretty well as has been? I do not quite recall, but when was the last increase? Was it the '97-98, and that is the VLT money? Was it '97-98 that there was an increase, or previous to that?

Mr. Derkach: The formula is basically the same as it was in the previous year. However, there has been, I guess, an increase in dollars in this area each year since the sharing of the VLT monies began up until this year. We see a levelling off of the programs this year, and basically the dollars are constant this year.

The Acting Chairperson (Mr. Helwer): Item 13.6.(c) Unconditional Grants - Rural Community Developments $6,000,000–pass.

Resolution 13.6: RESOLVED that there be granted to Her Majesty a sum not exceeding $21,000,000 for Rural Development, Rural Development Programs, for the fiscal year ending the 31st of March, 2000.

We will go on to 13.7. Capital Grants (a) Transit Bus Purchases $180,000–pass; (b) Water Development $1,773,500.

Mr. C. Evans: There is an increase here, I see. Obviously, then, we are looking at developing and assisting in water distribution and development in different areas, more areas than we have in the past, so we are then providing a little bit more resources for this initiative then? Is that the reason for the increase?

Mr. Derkach: In the overall program, in our water and sewer development program, I think, overall allocation is approximately $12 million. Within that $12 million we will see some shifts because of demands in one area or the other. In this current year, we are projecting more activity in the Water Development side, in the Sewer and Water side as well; therefore, there are more dollars allocated to these areas because of a greater demand in these areas at this time.

The Acting Chairperson (Mr. Helwer): 13.7.(b) Water Development $1,773,500–pass; (c) Sewer and Water $5,966,500–pass; (d) Canada-Manitoba Partnership Agreement on Municipal Water Infrastructure, nothing there.

Mr. C. Evans: Nothing there. Is the program stopped?

Mr. Derkach: Yes, Mr. Chairman. As the member knows, this was the old PAMWI program, a very effective program, I might add, but it has come to a conclusion. Last year was our last allocation in it, so it is basically a completed program.

The Acting Chairperson (Mr. Helwer): 13.7.(e) Conservation Districts $2,570,000–pass; (f) Infrastructure Development $11,405,800.

Mr. C. Evans: I see by reading the appropriation book that there are some projects that have been identified, so, of course, we are looking at an increase of funding.

Now, is this a cost share, these projects here? Is the $11 million that is provincially, is that cost shared by the feds at all?

Mr. Derkach: Mr. Chairman, most of these are provincial commitments, but there are a couple that have federal participation. One of those is the rural gassification program has federal participation, and also the Dauphin water supply. There is federal participation in that. Other than that, the rest are all provincial programs.

* (1750)

The Acting Chairperson (Mr. Helwer): Item 13.7.(f) Infrastructure Development $11,405,800 –pass, for a subtotal of $21,895,800; (g) Less: Recoverable from Rural Economic Development Initiatives ($5,075,800)–pass; (h) Less: Recoverable from Capital Initiatives ($8,350,000)–pass.

Resolution 13.7: RESOLVED that there be granted to Her Majesty a sum not exceeding $8,470,000 for Rural Development, Capital Grants, for the fiscal year ending the 31st day of March, 2000.

Next is 13.8. Amortization of Capital Assets $413,900.

Mr. C. Evans: Could the minister just quickly explain this. I see a tremendous increase. Just if he could quickly explain this line to me.

Mr. Derkach: As the member realizes, this is a new section of the Estimates process. It is the amortization of our Desktop equipment, Mr. Chairman, and it has been instituted as an accounting practice by the Department of Finance. Our existing inventory was at 16.8. We have added the Desktop Management Initiative as well as the Better Methods Initiative to that this year as new initiatives, so in the next set of Estimates we will see some comparisons. This is basically a benchmark for these areas.

The Acting Chairperson (Mr. Helwer): 13.8. Amortization of Capital Assets, $413,900–pass; for a total appropriation of $52,250,600–oh, forget that. We will go back to Clause 13.1. Minister's Salary. We will wait until the minister's staff leave the room.

We will go back to Resolution 13.1. Administration and Finance (a) Minister's Salary $27,000. Shall the item pass?

Mr. C. Evans: I just want to extend thanks to the minister's department and staff for this year's Estimates. I am hoping that we can continue in this department, that Rural Development continues to play a major role in the future of our rural areas.

I want to reiterate that fact that we must not forget all of rural Manitoba. We must be there for all of rural Manitoba, as government, as MLAs, as departments. As well, I am happy that there are successful operations and new businesses and employment in areas of our province, but as I said in my opening statement, there is a need for the communities within the Interlake, for the communities in Dauphin, for the communities in some of the other regions and areas, even Lakeside, and on the east side, that we have to do, I think, collectively what we can. We can have people want to go out to rural Manitoba and make Virden double in size in 10 years and Riverton double in size and Roblin-Russell or whatever communities so that we can do that.

I just want to indicate to the minister in closing that I know I can say on record that there is not a problem on our side of the House with our rural members whatsoever as far as some of the initiatives that are being put in place through the department. I think we would just probably like to see more of the services that I indicated to him before. Repeating myself or not, I think it is so important. Rural development cannot be rural development without good infrastructure in our communities and a good reason for people to want to be out in rural Manitoba and live and establish themselves–schooling, with health care and roads.

I think that the Department of Rural Development should always, regardless of government, be a leader in saying that we have to do that so that we can have a rural Manitoba to go to and not more isolated places and people leaving their communities because of a lack of economic development or a lack of infrastructure or lack of health care. That is my belief. The department is more than just a rural development, more than just a provider of financial resources, it should be an initiative department to get the other services out there and to force the other departments to play the same role as Rural Development is playing. I hope, in a nonpolitical way, that we can continue that as the Manitoba Legislature regardless of the government stripe that is in place. Thank you.

Mr. Derkach: Well, Mr. Chairman, in response, I just want to say, and I am sure I speak for the staff of my department, that we have had a very good experience in dealing with the many communities in rural Manitoba. Indeed, I think, rural Manitoba communities are onside in terms of rebuilding and sustaining their communities so that we can attract more young people into our smaller communities around rural Manitoba. We know very well that a city in this province cannot be strong without a strong economy, and the same is true for the opposite as well.

I also want to say that I would like to say thank you to my critic, because I think that others can take a page out of the relationship that we have had with the critic because indeed there is a time to criticize, there is a time to support, and I think the critic for Rural Development has done that in an effective way. I think he has gained the respect of a lot of rural Manitoba people because of the approach that he has taken. I am not shy about saying that that is an approach that I would like to see more prevalent among members of the Legislature because it goes to a more constructive approach in building the economy of our province and, in this case, the rural part of our province.

So, Mr. Chairman, I want to continue in that vein and I want to continue in that spirit so that together we can build a stronger economy, a stronger province for the benefit of our children and for our grandchildren as well. With that, thank you.

The Acting Chairperson (Mr. Helwer): Thank you, Mr. Minister. We will deal with the Minister's Salary. 13.1.(a) Minister's Salary $27,000–pass. We will deal now with the total.

Resolution 13.1: RESOLVED that there be granted to Her Majesty a sum not exceeding $1,477,300 for Rural Development, Administration and Finance, for the fiscal year ending the 31st day of March, 2000.

Is it the will of the committee to call it six o'clock? [agreed] Committee rise. Call in the Speaker.

The Acting Speaker (Mr. Helwer): The hour being six o'clock, this House is now adjourned and stands adjourned until 10 a.m. tomorrow (Thursday).