Mr. Speaker, I am pleased to update Members on the implementation of new community government funding allocations that will come into effect April 2025.
MACA distributes over $110 million in annual funding through the community government funding policy. While this funding was never intended to cover 100 percent of community funding costs, the funding helps community governments cover the costs of core programs and services like clean drinking water, local roads, recreation, and public safety.
Mr. Speaker, these policies have remained unchanged in over 15 years. In 2024, MACA undertook a comprehensive review of the policies in collaboration with elected officials and administrative staff from 17 community governments, as well as representatives from the Northwest Territories Association of Communities and the Local Government Administrators of the Northwest Territories. The review recommended updates to the funding policies and allocations to bring more transparency and to align funding more effectively with community needs and activities.
In 2023, the Ministerial funding policies were updated to better reflect the current costs of typical community programs and services, allowing funding to be allocated fairly and equitably. These policies also uphold the decision-making authority of elected community councils, allowing them to prioritize programs and services that best meet the needs of their residents.
Over the past year, MACA has been working to implement these changes. The department engaged with 28 of 32 community governments to discuss the details and gather further feedback on various implementation options. I also met with the community leaders to hear their perspectives and insights firsthand.
Mr. Speaker, these updates do not introduce new funding for community governments. As noted, distribution models has remained unchanged for over 15 years. During this time, some community governments have received funding levels exceeding over 100 percent of the standard costs.
These adjustments are being made to ensure that all community governments receive a fair and equitable share of these funds. When the new allocations are implemented on April 1st, some community governments will experience increases in their funding, while others will receive a decrease. These updates are the result of extensive engagement over many years. Some community governments welcome these changes while others have concerns.
I have heard from leaders who are worried about funding reductions, particularly in smaller communities with less financial flexibility. At the same time, I have also heard from community governments that have been underfunded for years and has waited long overdue correction. We took these perspectives seriously, made changes to the policies based on our consultations, and are now moving forward with implementation.
To allow for a smooth transition, operations and maintenance funding levels will remain unchanged for the next three years, except for community governments funded over a 100 percent. That will be reduced to 100 percent giving local governments time to assess priorities and adjust accordingly.
To address longstanding funding disparities, changes to the community public infrastructure and water and waste services funding will be phased in over three years, starting April 1st, 2025. This is being injected as much-needed capital dollars and funding to support core services.
Based on the feedback received, MACA will also make further adjustments to the CPI policy to help address recruiting challenges related to staff housing needs. Additionally, MACA will undertake further analysis of the water and sewer rates with the community governments to ensure this core service remains affordable to residents, meaning no immediate changes to water rates will be required at this time.
Funding sustainable municipal services is a shared responsibility across all levels of government. MACA remains committed to advocating for increased funding to ensure local governments to have the necessary resources for core municipal services. Each community government must make its own decisions about what services to provide and how to fund any costs beyond what is covered by MACA's core funding services. We will also continue to work with those who have unspent capital funds to support them in implementing their priority projects.
Mr. Speaker, community governments play a vital role in delivering essential services across the NWT. MACA remains committed to ensuring that they have the tools, resources, and funding required to meet the needs of the residents. Thank you, Mr. Speaker.
