'Green' spending, consumer fees go up in N.W.T. budget

Hard economic times have pushed the Northwest Territories government to ramp up spending and borrow millions of dollars in short-term debt, Finance Minister Michael Miltenberger said on Thursday.

The N.W.T.'s 2009-10 budget gives a "fiscal stimulus" in the form of $1.2 billion in operational spending and a record $246 million in capital infrastructure spending. The spending isabout $23 million more than last year,a two per cent increase.

Revenues have gone up by 3.9 per cent to $1.3 billion in 2009-10, thanks to the federal government's territorial financing formula and the N.W.T.'s own revenue sources.

However, Miltenberger said the government will have to borrow $81 million in short-term debt to pay for the government's planned infrastructure spending. He said he hopes to have that debt paid back early in the following fiscal year.

'We must proceed carefully'

"We are gathered here in a time of unprecedented global economic turmoil that continues to worsen daily," Miltenberger told the legislative assembly in his budget address Thursday afternoon.

"The economic downturn is likely to last at least until 2010, and possibly longer. No one can predict exactly what will happen next. In such circumstances, we must still move forward, but we must proceed carefully and prepare to be flexible."

The budget is less ambitious than last year's, when then-finance minister Floyd Roland proposed cutting $135 million in spending, which would have included upwards of 140 job cuts to the N.W.T.'s civil service. An outcry by the public and other MLAs prompted the government to drop much of that plan.

Miltenberger said only 14 people were laid off in this past fiscal year. The budget says 14 more people will affected by job cuts in 2009-10 if this budget passes.

The minister has also deferred the government's attempt to raise $30 million in new revenue in the 2010-11 fiscal year. He said the government is prepared to raise $7.3 million in new revenue instead.

Hydro, wind energy projects

A total of $60 million over four years will go towards reducing the territory's reliance on diesel and other fossil fuels and "making a real difference to the way we produce and consume energy," according to the budget.

In the 2009-10 budget, about $1.5 million will go towards implementing a territorial hydroelectricity strategy.

Another $2.5 million will fund a feasibility study on the proposed Talston hydro project expansion, which will help the government decide whether to go ahead with the project.

About $800,000 will be used in planning smaller hydro projects in the communities of Lutselk'e and Whati.

The government intends to spend $1.8 million to install wind turbines in Tuktoyaktuk. Miltenberger said he hopes to get the federal government involved in some cost-sharing arrangement.

The government wants to spend millions of dollars to reduce energy use in territorial government buildings, including $2 million to expand the use of wood pellet boilers in some buildings and $2.5 million for energy conservation initiatives in government buildings and public housing.

About $3.3 million will go towards investigating the potential of alternative energy sources such as geothermal heat.

Money for power subsidy, training

Lowering the cost of living in the North is another one of the budget's priorities, with $3 million over the next three years to go toward the territory's power subsidy program.

About $2 million will be go to the N.W.T. Housing Corp. so it can fix more public housing units while a total of about$600,000 will be spent on apprenticeship and trades training.

Miltenberger's budget contains several measures to bring more people to the N.W.T., including $535,000 to fund the first year of a three-year territorial nominee pilot program, aimed at bringing 50 to 100 immigrant workersto the territory.

About $1.5 million will be spent on developing programs to encourage creation of more staff housing, especially in communities where housing shortages prevents teachers, nurses and other professionals from moving there to work.

Tourism and the arts will receive a cash infusion in the budget: $700,000 in arts and culture grants, $400,000 to launch a national marketing campaign for the N.W.T., and $300,000 to help big game outfitters, including caribou and polar bear hunting outfitters, market their industry.

Fees go up for 'sin' items, plastic bags

So-called "sin taxes" on cigarettes and alcohol are going up in this budget, for the first time since 2003.

The price of cigarettes will rise by $11.20 per carton, while markups on liquor, beer and wine will rise by 10 per cent.

The budget introduces a 25 cent levy on each single-use plastic shopping bag issued at N.W.T. stores, taking effect sometime this fall.

It will also likely bring in some sort of deposit on milk cartons, which will be included in the territory's beverage container recycling program this coming fiscal year.

The budget calls for increases to some property and school tax rates, in order to keep up with inflation.

In an effort to bring in $300,00 more in annual revenue, the Transportation Department will raise fees in some areas, such as vehicle licensing, starting April 1.

'Rancour and anger'

Everything proposedin Thursday's budget will be subject to approval by the legislative assembly.

Miltenberger delivered his budget amid unprecedented political turmoil in the N.W.T., as backbench MLAs prepare to present a motion of no-confidence against Premier Floyd Roland and cabinet on Friday.

The backbenchers, also known as regular MLAs, say they have lost confidence in the government because of a number of decisions from the past year, from a proposal to change extended health care benefits for seniors to the awarding of a $34-million loan to aviation company Discovery Air.

Speaking to reporters Thursday morning, Miltenberger stressed that the MLAs' no-confidence motion is not about the budget. Given the consensus nature of the territorial government, he said members have been consultedduring the budgetprocess.

"The rancour and anger [from regular MLAs]has been there from the start, and it has dogged us," he said.

In the event cabinet is voted out, and a new one is brought in, Miltenberger said he hopes they will accept his budget as is, as opposed to trying to create their own.

"I would suggest the pressure would be enormous," he said. "This is a good budget, and people will want to see the projects [proceed]."