West Vancouver-Garibaldi MLA Ted Nebbeling, minister of state for Community Charter, recently discussed the Community Charter, the Liberal government’s proposed legislation to replace the Local Government Act, with Pique editor Bob Barnett.
Pique:
You recently had a symposium with municipal officials from across the province regarding the Community Charter. How did it go?Ted Nebbeling:
It was organized by the UBCM (Union of B.C. Municipalities). It was at the Vancouver convention centre because we knew we were going to get a big crowd. It was 600-700 representatives from across the province, elected officials, staff, administrators and so on.I was really pleased to see how positively local governments have reacted to the Community Charter draft. For a long time people have been waiting, asking what is it going to do for us. Now that they have the draft in hand, have read it, analyzed it, they can clearly see that this is a new foundation of how local and provincial governments will work together in the future.
Pique:
And what is it municipalities are looking to do with it? There’s lots of talk about municipalities being given new means of generating revenue.TN
: One of the things is that, today it is a property tax base and we collect the cost of running a municipality through that. We collect portions of the school funding through property tax as well. So property tax has become an incredibly burdened entity and we’re trying to find new ways to create new revenues for local governments, to reduce that pressure on property taxes. We’re looking in particular at user fees. So it is not all new taxes but user fees. So people who use a service or use a product pay a little bit more and people who don’t use that product don’t pay anything at all.So we have not put any final tax package in the community charter. What we have done is created a white paper and that white paper is used to stimulate discussion.
Now Whistler, for example, has for a long time asked for a resort tax, and the emotions I think in the community are mixed about it. Some are saying that’s a great idea because if we can get a dollar from every visitor going to the municipality, that will reduce the pressure on property taxes considerably. Others are saying well, you know we are expensive enough and if we add more to it…
The problem is as a municipality, they pay bills. They pay for the infrastructure, including a sewer and water treatment plant. And if we feel that you shouldn’t get the users, that includes all the visitors, to make a small contribution toward that cost, then at the end of the day you have to go back to your traditional base, which is property taxes.
So it is not in my opinion a tool for local governments to add on to what they have already. It must be seen as a tool to reduce what is their only source (of revenue) today.
Pique:
So you see it reducing people’s property taxes?TN:
That’s the whole thinking behind it.So the upgrade of the sewer treatment plant we are looking at – that’s a big hit – the only tool is indeed the property tax base. If we can collect say 50 cents or a dollar through a different mechanism that is not directly property tax but based on who comes to Whistler…
For me one of the things that has justified considering a resort tax is that we have an infrastructure that has to service about 55,000 or 60,000 people. Here we are with an infrastructure serving 55,000 people, potentially, and at the same time the community that pays for it is about 10,000. So that’s an incredible burden.
Now, we are here because the other 45,000 people provide us with our income, so don’t complain about the numbers. But if we can somehow get some new mechanisms…
We are also looking at a bylaw court type of set up, I think you’ve heard about that. That has always been part of the Community Charter, although it is the Attorney General’s office that controls that. We are making good steps forward there so that local governments can collect tickets that have been written for bylaw violations and building violations.
Pique:
Let me go back to property taxes for a minute. Did the municipalities at the symposium really see the community charter as a tool to reduce property tax revenues?TN:
What they’re saying is they need new elements as tools to reduce the property taxes. We know how property taxes are pushed to the limit, but they’re still going to pay more costs in providing the services the community needs. So, can we find these tools?Nobody has made a choice what they should be. That’s the dialogue that will go on until the middle of August and that’s why I will again be on the road into the regions, having these focused discussions. But nobody denies that new tools have to become available, and it shouldn’t be tools that automatically go back into the same people’s pockets. So it is not simple.
Right now there is new dialogue ongoing with the federal government, because the federal government is beginning to realize what the provincial government and the federal government take together in all type of taxes is about 90 per cent of all taxes paid, and the municipalities get 7-8 per cent, and that’s it. So we’re trying to see if we can create some tax room with the federals, and if that happens then the provincial government may also have to give up some tax revenues.
Pique:
So you can see the federal and provincial governments giving up some tax revenues?TN:
I can only see that happening if that becomes a joint effort, and that discussion is very prominent right now between local governments from all over Canada and the federal government. And the federal government is beginning to give some signals that they would maybe entertain that new direction.Gary Collins, the minister of finance, recently said maybe we have to give up some of the gasoline tax rather than expect communities to add more (tax) points to the system.
So that’s the direction I’m pushing in and I think local governments like that.
Pique:
Can the province afford to give up any tax revenue right now?TN:
Well, one of the reasons we have gone through a tough year, and had to make many, many tough decisions in order to get our financial management under control – and that’s a three-year program, of course – many of these steps are taken in order to get a healthier financial climate in this province. And yes, when our program begins to work and you see increased job creation, you see increased funding for the social services like health care, education, I think we as a province will be able to say OK, maybe the taxes should go back to the community.On top of this of course we are still committed in this term to make crown corporations pay property taxes if they are a business. Seventy-five per cent of the policing costs, of the tickets collected by the police, that revenue, 75 per cent of it we’re going to return back to the community.
So it is not that we’re looking at user fees or taxes, we’re looking at the whole package. That at the end of the day will allow local governments to step back from that property tax pressure that they are facing today. And when they face it it’s the community that faces it, it’s the business community that faces it, it’s the industrial community that faces it. And it is beginning to undermine the viability of quite a few businesses throughout the province. So we are risking that we are beginning to tax businesses out of the communities. We have to stop that.
Pique:
One of the principles in the community charter is that there will be no downloading on municipal governments, and the examples given are when a provincial roadway becomes a municipal responsibility the province will provide the local government with funds to look after the road. But hasn’t the province already downloaded costs on some municipalities with the closing of courthouses; some municipalities are trying to raise funds to keep them open? And the conservation office recently sent Whistler council a letter saying that they were cutting staff, and now the municipality is looking at training some of its bylaw officers to take on conservation officer duties.TN:
Downloading is when, by legislation, the provincial government orders a local government to take on the responsibility, and does not provide the financial resources to take on the responsibility. That is downloading.Things always change. Nothing stays the same. Like you say with the conservation officers. The branch that runs that program claims – and they haven’t made that claim to me – but claims that they haven’t got the funding for a full contingency of officers in this corridor. So we still provide the service. We are not downloading the service on to local government. We are not saying by legislation, "from now on you will be responsible and you will pay for it." That’s downloading.
Pique:
That’s a service that’s been cut.TN:
It’s a service that’s been cut, but guess what? Local governments do this as well. In difficult times – they provide a service and they can’t keep up the level of service so there’s a reduction in service, but the service is still there.So downloading to me is more when we take a responsibility that is purely provincial and by legislation, hand over the whole responsibility to a council. And that happened in the last decade in the order of $1.2 billion, of clearly provincial responsibilities that communities were then responsible for.
So that is by law no longer allowed.
Pique:
The white paper on the community charter was introduced in May. There will be discussion over the summer. Legislation will be introduced in the fall…TN:
The bill will be introduced in the fall, we will have first, second, third reading, and then it will be passed – if the vote goes as expected. But we have a bit of a majority so I feel quite confident that it will.Pique:
Does that give municipalities time to implement some of these financial tools in time for their 2003 budgets?TN:
The impact of the new basket of tools, so to speak, will not be noticeable at the next, 2003 assessments, because the assessments are already done in October this year. The assessments that drive the setting of the rate are done in October by the B.C. Assessment Authority.We grappled with this as well. If we pass it in the fall session should we then enact it immediately, or should we let the municipal elections take place (in November) so that the new councils get to work with the new tools? We are certainly educating the administrators and the clerks in advance, and the symposium was part of that process, so that they understand what the new foundation of the relationship is. And so when the new councils come in it will be a lot easier for the new council members to understand what the community charter really is, compared to a total lack of understanding of what the Local Government Act represents today.
The Local Government Act today is a huge thick volume, 1,130 sections telling local governments what they can not do, and if they can do something how they can do it.
We have removed so many sections that there’s only 295 sections left and they discuss… "here’s you power." And it is almost like a result-based thing. Here is your power and it is your decision. You do not have to pass a bylaw and then make sure that Victoria is OK with it, as is the case today.
So we really have taken the dog collar off and allowed local governments many powers to make decisions that they feel are for their community.
Now, there are certain powers that they don’t have, but they will become shared powers, and that is environmental standards, building standards, the Police Act, public health – just to name a few. These standards remain provincial, the only difference is that in the past you couldn’t do anything about it as a local government. Now the local government can say "hey listen, this environmental study doesn’t work and here are the reasons." You go to the minister and you convince the minister that in your unique situation, the general rule doesn’t work and so it becomes a joint power.
The third thing – and it is amazing how local governments like this – is the accountability process. I was concerned that they were going to see this as a control that they don’t need. You know, "we have been elected so therefore let us do our thing and after three years we’re accountable." That doesn’t work because they have more responsibility (under the Charter) and the Charter basically… well maybe you call this a download, but we are saying no longer will the provincial government hold local governments accountable. We will create a new mechanism where the community has the tools to hold that council responsible. I think that is a lot healthier.
So, the accountability section describes how local governments, on an annual basis, by law have to report in writing to the community. That report has to follow certain criteria, and we’ll set some benchmarks. And then once a year a town hall must be called to discuss that report, talk about the benchmarks, the objectives that council has put up for the past year, what have they done with it, how does it fit against other communities of the same or similar character. And then what are they going to do for the coming year.
That will be mandatory, so communities are going to have a stronger opportunity to be part of how decisions are made and then once a year have an opportunity to look at the council’s actions, and say "yeah, you met what you said you were going to do," or "you blew it." And then of course in an upcoming election it will be remembered.
The other thing with all the additional powers given to local governments – and none of these powers are tools they didn’t have, the only thing is when they used one of these powers to enact a bylaw they still had to go to Victoria and have them second guess, which was bureaucratic-driven, time-consuming.
So we’re saying now you don’t have to come to Victoria. Do your thing.
But, with that new power we also want to make sure local governments have new ethical standards. In the Local Government Act there are no ethical standards that councils have to adhere to, so we’re putting some ethical standards into the community charter and if an elected local member violates these it carries a penalty. So it gives the penalties as well. We’re still tweaking that a little bit.
So these are the three components that I think make up the charter, and the accountability component is very substantial and I really think it will be the tool for the grass roots of the community to come back again. It’s gone (now). Squamish had a referendum on the university; 18 per cent (turnout). That’s unbelievable. Something that is so crucial for Squamish. That university will kick-start their whole spirit as a community again. It will create jobs. It will create so many other opportunities that…. Only 18 per cent of the people took the time to come out. What a shame. What a shame.
So I hope with the community charter and the new tools for the communities to participate in their futures that more people are saying, "Well it is meaningful to participate." Up to now they’re saying, "Well if I go to municipal hall it’s drafty, I have to sit in a hard chair." They get the feeling the decisions have already been made. That can be reversed with the accountability process.
Pique:
Anything else about the Charter we should know?TN:
The essence of the charter is that British Columbia’s communities have worked in a relationship that was based on rules created 150 years ago: Urban areas should not be having any status as a government. They should merely be a creature of the province.And of course when the constitution was written in 1867, that principle was included in the constitution. So for 150 years the relationship between the provincial government and local government has been based on these rules.
The Charter is saying no. We are creating new rules that reflect the year 2002 and beyond, and creating a new basis of how local government works with the provincial government, where local government truly knows best what’s happening in the community and what the community needs. And as long as we put these accountability measures into the system the community as a whole will decide what they want to do and where they want to go for their future. That’s the fundamental shift. Victoria is no longer holding local government accountable, it’s the community.
