February 11, 2000


The House proceeded to the consideration of Bill C-10, an act to amend the Municipal Grants Act, as reported (with amendments) from the committee.


?

The Acting Speaker (Mr. McClelland)

There are 44 motions in amendment standing on the Notice Paper for the report stage of Bill C-10.

The motions will be grouped for purposes of the debate as follows:

Group No. 1: Motions Nos. 1, 2, 4 to 19 inclusive, 41 to 44 inclusive.

Group No. 2: Motions Nos. 3, and 20 to 40.

The voting patterns for the motions within each group are available at the table. The Chair will remind the House of each pattern at the time of voting.

I shall now propose Motions Nos. 1, 2, 4 to 19, and 41 to 44 to the House.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, BQ)

moved:

Motion No. 1

That Bill C-10, in Clause 3, be amended by replacing line 8 on page 2 with the following:

““business or professional occupancy tax” means a tax levied”

Motion No. 2

That Bill C-10, in Clause 3, be amended by replacing line 29 on page 2 with the following:

“constructing a new immovable or a new real property,”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 4

That Bill C-10, in Clause 5, be amended by adding after line 25 on page 7 the following:

“(1.01) If the Minister decides not to make a payment under subsection (1) to a taxing authority applying for it, the Minister shall, without delay, provide the authority with written reasons for that decision.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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LIB

Don Boudria

Liberal

Hon. Don Boudria

Mr. Speaker, I rise on a point of order. I wonder if the House would agree that we deem the motions to be moved, seconded and read.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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?

The Acting Speaker (Mr. McClelland)

The government House leader has requested that all of the motions be deemed moved, seconded and read. Is there unanimous consent?

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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?

Some hon. members

Agreed.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 5

That Bill C-10, in Clause 5, be amended

(a) by replacing line 26 on page 7 with the following:

“(1.1) If a”

(b) by replacing line 29 on page 7 with the following:

“may supplement the payment but where the Minister decides not to do so, the Minister shall, without delay, provide the taxing authority to which the payment is to be made, with written reasons for that decision.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, Bloc Quebecois)

moved:

Motion No. 6

That Bill C-10, in Clause 5, be amended by replacing line 26 on page 7 with the following:

“(1.1) If a”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 7

That Bill C-10, in Clause 5, be amended by replacing line 35 on page 7 with the following:

“that the”

Motion No. 8

That Bill C-10, in Clause 9, be amended

(a) by replacing line 27 on page 10 with the following:

“(2) Subject to subsection (3), if a frontage or area tax is payable over”

(b) by adding after line 31 on page 10 the following:

“(3) The Minister shall notify a taxing authority to whom a payment in lieu of a frontage or area tax is payable over a period of more than one year, which method of payment referred to in subsection (2) will be used to make the payment, and shall, without delay, after that notification, provide the authority with written reasons explaining why that method was chosen by the Minister.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, BQ)

moved:

Motion No. 9

That Bill C-10, in Clause 10, be amended by replacing line 12 on page 12 with the following:

“made in lieu of a business or professional occupancy tax by”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 10

That Bill C-10, in Clause 10, be amended by replacing line 13 on page 12 with the following:

“the Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation and every corporation included in Schedule IV;”

Motion No. 11

That Bill C-10, in Clause 10, be amended by replacing line 21 on page 12 with the following:

“a frontage or area tax and, in the case of the Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation and a”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, BQ)

moved:

Motion No. 12

That Bill C-10, in Clause 10, be amended by replacing line 23 on page 12 with the following:

“ments in lieu of a business or professional occupancy tax;”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 13

That Bill C-10, in Clause 10, be amended by replacing line 25 on page 12 with the following:

“the Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation and corporations included in schedules III or IV,”

Motion No. 14

That Bill C-10 be amended by adding after line 27 on page 12 the following new clause:

“10.1 The Act is amended by adding the following after section 9:

9.1 For greater certainty, the Governor in Council shall not make regulations adding the following corporations to Schedule IV: (a) the Royal Canadian Mint; (b) Canada Post Corporation; and (c) Canada Mortgage and Housing Corporation.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, BQ)

moved:

Motion No. 15

That Bill C-10 be amended by adding after line 27 on page 12 the following new clause:

“10.1 The Act is amended by adding the following after section 9:

9.1 (1) No regulation made by the Governor in Council under section 9 shall come into force unless it has been approved by a committee of the House of Commons that is designated or established by the House for that purpose.

(2) A regulation approved by a committee of the House of Commons under subsection (1) comes into force on the day following its approval.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

moved:

Motion No. 16

That Bill C-10, in Clause 11, be amended by replacing line 39 on page 12 with the following:

“authority.

10.1 Notwithstanding anything in this Act, where a corporation included in Schedule III or IV is authorized to make a payment to a taxing authority in lieu of a real property tax, a frontage or area tax or a business occupancy tax, as the case may be, pursuant to regulations made under subsection 9(1), and decides not to make that payment, the corporation shall, without delay, provide the authority with written reasons for that decision.”

Motion No. 17

That Bill C-10, in Clause 11, be amended by replacing line 39 on page 12 with the following:

“authority.

10.1 Notwithstanding anything in this Act, where the Royal Canadian Mint, Canada Post Corporation or Canada Mortgage and Housing Corporation is authorized to make a payment to a taxing authority in lieu of a business occupancy tax and the corporation decides not to make that payment, the corporation shall, without delay, provide the authority with written reasons for that decision.”

Motion No. 18

That Bill C-10, in Clause 13, be amended by replacing line 10 on page 13 with the following:

“(b) the Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation and every corporation included in Schedule”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Ghislain Lebel

Bloc Québécois

Mr. Ghislain Lebel (Chambly, BQ)

moved:

Motion No. 19

That Bill C-10, in Clause 13, be amended by replacing line 12 on page 13 with the following:

“or professional occupancy tax, comply with any regula-”

Motion No. 41

That Bill C-10 be amended by adding after line 40 on page 14 the following new clause:

“15.1 (1) The Minister shall, within twelve months after the end of each fiscal year, cause a report on the administration of this Act during the preceding fiscal year to be made.

(2) The Minister shall cause a copy of the report referred to in subsection (1) to be laid before the House of Commons on any of the first fifteen days on which that House is sitting after the day on which the report is made.”

Motion No. 42

That Bill C-10 be amended by adding after line 40 on page 14 the following new clause:

“15.1 (1) The Minister shall, within twelve months after March 31, 2004 and every four years after that, cause a comprehensive review and report of the provisions and operation of this Act during the preceding four years to be made.

(2) The Minister shall cause a copy of the report referred to in subsection (1) to be laid before the House of Commons on any of the first fifteen days on which that House is sitting after the day on which the report is made.”

Motion No. 43

That Bill C-10 be amended by adding after line 40 on page 14 the following new clause:

“15.1 (1) The Minister shall, within twelve months after March 31, 2005 and every five years after that, cause a comprehensive review and report of the provisions and operation of this Act during the preceding five years to be made.

(2) The Minister shall cause a copy of the report referred to in subsection (1) to be laid before the House of Commons on any of the first fifteen days on which that House is sitting after the day on which the report is made.”

Motion No. 44

That Bill C-10 be amended by adding after line 40 on page 14 the following new clause:

“15.1 (1) The Minister shall, within twelve months after March 31, 2003 and every three years after that, cause a comprehensive review and report of the provisions and operation of this Act during the preceding three years to be made.

(2) The Minister shall cause a copy of the report referred to in subsection (1) to be laid before the House of Commons on any of the first fifteen days on which that House is sitting after the day on which the report is made.”

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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REF

Werner Schmidt

Reform

Mr. Werner Schmidt (Kelowna, Ref.)

Mr. Speaker, actually Bill C-10 is not that bad. It is a reasonable bill because it changes the title of the bill to refer to payments in lieu of taxes rather than grants in lieu of taxes. That is a pretty reasonable thing to do.

Another thing we need to recognize is that the bill provides a certain element of fairness and equity to municipalities so that they can actually predict what will be happening and they can make projections in terms of budgeting.

The bill is supported by the Federation of Canadian Municipalities. It is certainly consistent with Reform Party policy, which is that governments should be paying the same property taxes that other citizens of Canada pay. It is very important that we have fairness, equality and equity in the whole business of property taxes as far as the government is concerned.

However some very significant amendments need to take place at this time. In particular, we need to recognize the accountability factor in this bill.

The bill provides discretionary power to the minister. It gives the minister the discretionary power to do a number of things. He may pay the taxes; he may not pay the taxes. He may make those payments or he may not. He may pay those taxes late. If they are paid late, he may decide whether or not they are in fact late. He also may decide whether he should pay supplementary payments, such as interest payments, on those particular late payments of taxes. All of that is at the discretion of the minister. The same discretion also applies to the corporations. While the constitution provides that the Government of Canada cannot be forced to pay property taxes or make payments in lieu of taxes, the coercion element cannot be done unless there is a constitutional amendment.

Another factor could be introduced here. That factor is to ensure that the minister, when he decides to change the assessment, the time of payment or the supplementary payments in lieu of interest or a late payment, in all of those cases the minister should be required to provide a reason for his particular delay or his change or amendment of the amount that he should be paying to the respective municipalities. That should be a requirement of the minister. It does not ensure that the minister does not have discretion; he does have discretion, but he must account for that discretion.

I think that is a reasonable amendment. It is one which I think we should all expect. Why is that so important? In lieu of what has just happened to one of the minister's colleagues in Human Resources Development Canada, I would think that the minister would welcome that kind of accountability. Then the municipalities could not say, “He is just doing this for his friends. His friends, if he has some in municipal government, get paid right away and they get paid the exact amount. Others who are not his friends get paid later or they do not get paid interest or whatever”. There could be no accusation of favouritism. I think the minister would welcome that sort of thing. The same argument applies to the crown corporations.

I want to refer to how serious this can become. There are some things that happened in that audit which was done recently. I want to read a couple of those things into the record.

One of the findings of that audit was on 13 signatures that were selected during the file review. It was revealed that in three cases out of the 13, that is almost 25%, the delegation instrument, that is, giving somebody the delegated authority to sign something, in three instances out of 13 files, which is 25%, the signing officer, that authority, could not be produced. In 25% of the cases the guy had delegated power but he could not actually say who had delegated that power to him. This is serious.

In six cases, almost half, the delegation was only valid upon notification of acting and for a limited period of time. No such notification had been received for the period the document was signed. Even if the delegation had taken place, it was for a very specific time, a time in which the person with the delegated power exercised signature authority that was outside the parameters originally delegated to him. That is pretty serious.

There is another one case under contracting. In four contribution agreements out of every ten reviewed, irrelevant clauses in standard agreements were not crossed out or blanks were not filled in to specify conditions such as the periodicity of the submission of claims or the period of notification if it were necessary for HRDC to terminate the project before completion.

Listen to this one. In one-third of the projects reviewed, the original dollar value of the agreement was upward in most cases. In 36% of these cases the reason for the amendment was not documented. It requested one amount, the amount was reviewed and it increased in 36% of the cases. This is the kind of thing that should never happen. This has to be revealed through an audit as an indictment of the process.

What we are trying to introduce in this legislation is a clause that would protect and help the Minister of Public Works and Government Services. It would be amended in such a way that it would make it easier for him to have an administration that is sound, honest, trustworthy and transparent and where the processes will bear examination. It will make it clear to all and sundry that the minister is doing his job uprightly, honestly, fairly and in the best interests of all Canadians.

That is what the amendments in group one are all about. We specifically suggest Motion No. 4. The bill currently reads that “the minister may make payments”. It is not possible, as I indicated before, that he be forced to make those payments. We would suggest, however, that if he does not want to make those payments, then he must justify that particular situation.

Are there such cases? Yes, there are. There is a dispute right now involving the Halifax Citadel with regard to who should pay the taxes on the property. The Department of Public Works and Government Services has agreed to pay for the part that is a shelter but not for the entire structure. The argument is that this has to be interpreted. The department is suggesting that the interpretation be done by a court, which is not unreasonable.

On the other hand, should the assessment be left to professional assessment people? I think this is an argument that clearly shows that Public Works and Government Services has done something right. It is asking some good questions. However, the point remains that there has to be a reason given whenever these payments are stopped. In this case the payments were stopped. The minister should be required by law to give a reason for his particular noncompliance.

The other case has to do with the advisory panel that falls under Group No. 2, which I will not deal with here.

I will now deal with Motion No. 7. Motion No. 7 would amend the ministerial discretion which says “in the opinion of the minister” as pertaining to the period that the payment has been unreasonably delayed. The municipality sends out a notice of taxation indicating that the bill is due at a particular time. The dates are very clear and very specific. If the payment is not made at that time but made at a later date—let us say it is due on July 1 and the payment is not made until July 31—according to the act, if in the opinion of the minister that payment is late, he may recognize it. This is not a matter of opinion. It is very clear that if the taxes are due on July 1, they are due on that date, not on July 31. If the taxes have not been paid on July 1, then they are late.

This amendment makes it clear that the minister should have a clear explanation of what it is he is doing when he opines a shift in date like this.

What this really does is it puts the payment in lieu of taxes on a more solid footing and moves in the direction of making the minister accountable. It is in the interest of all Canadians, and I think in the interest of the minister, to have that kind of protection in law. The minister would now be able to withstand any audit that might cast aspersions that he has not administered his department well.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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BQ

Claude Bachand

Bloc Québécois

Mr. Claude Bachand (Saint-Jean, BQ)

Mr. Speaker, I am delighted to speak to Bill C-10. We have been following it closely for some time in the riding of Saint-Jean.

We will be debating something very important here. Historically, the Queen did not have to pay taxes to her subjects. This is an old issue. The Anglo-Saxon people were great colonizers and their practice was, as soon as they conquered part of a continent or a country, to establish a rule that the Queen, who had conquered the land, did not pay taxes to her subjects. Quite the reverse, her subjects were to pay taxes to her, often excessively.

Today we are in a longstanding debate, which the government is trying to update, because it has been going on for some time. There have been changes over the years. In the early days of Confederation, the federal government, following in the tradition of its predecessors, did not want to pay taxes to the people and to municipalities. They did not want to make transfer payments. The idea was to collect money to enrich the central government.

Over the years, the government was obliged to assume certain responsibilities, because the people in the municipalities knew very well that they had to pay their municipal taxes to the municipality. Not only did they pay taxes to the federal government, but they had to pay them to the provincial government, and they paid property taxes to the municipalities.

It was rather difficult for a subject to pay taxes on the full assessed value of his residence and see that the Queen or the central government did not pay taxes on federal buildings in municipalities. Still the principle that the Queen does not have to pay taxes was maintained in part.

To avoid saying that these were taxes the federal government had to pay, they were called payments in lieu of taxes. This is the point at which the arbitrariness starts, because I pay taxes on the full assessed value of my residence, but things are not at all the same for the federal government, which never pays on the full assessed value of buildings and land it owns in municipalities.

Over the years, some municipalities have come to realize that the situation was not only arbitrary, but that it was also extremely difficult to budget year after year, because they find themselves at the mercy of the minister who can say “Listen, I sent you X number of dollars last year or two years ago. Now I am considering reducing that amount”.

I will give the figures for Saint-Jean. The city of Saint-Jean has a budget of $50 million, out of which $4.2 million come from a federal transfer in lieu of taxes. This is easy to understand. There are many federal properties in the riding of Saint-Jean, including the military base, Agriculture Canada's research centre and the old military college. Incidentally, I hope the government will announce in its February 28 budget that it will correct the current situation and reopen the military college. However, this issue was already a concern when that institution closed.

When the military college closed, the city of Saint-Jean was getting $900,000 in taxes from that institution. Members can see why the city is anxious to find out what will happen regarding these taxes.

That amount was maintained in the money given to the military college, with the result that, today, the city of Saint-Jean receives $4.2 million from the federal government, out of a budget of $50 million.

But when we found out that a consultation would take place and that it would be important for the federal government to determine certain conditions and provide certain specifications on how it was going to hand out that money from now on, I immediately warned not only the city of Saint-Jean, but the various municipalities in which there are federal properties. I did that because the examples from recent years clearly show that when the government wants to reform soomething, it is never because it wants to give back more to the public. It is always to give less.

There are many typical examples, including the Canada social transfer. At one time, before the Canada social transfer, the federal government was giving money to the provinces for social assistance, health and post-secondary education. What has the Liberal government done since 1994? It has put all this into a single program, a single item called the Canada social transfer. And the amounts transferred are no longer the same. The provincial government is currently experiencing a $1.7 billion shortfall. No wonder things are bad in emergency wards, not only in Quebec, but in the other provinces also.

Another example is unemployment insurance, now dubbed employment insurance, where, in the name of reform, the government has managed to arrange for individuals to receive less. Right now, the government is pocketing between $6 and $7 billion, having reduced eligibility for these programs and worked it so that now people pay premiums from the first hour of work.

A lot more goes into the government coffers than comes out, with the result that the government is getting richer.

We wanted to be sure that when the government said that it was going to consult, to set up a panel with the municipalities to discuss the issue, that these municipalities would not be left worse off. We know what happens when the municipalities have less. The federal government hangs on to the money and the provinces, municipalities and citizens are left to make up the difference.

The public is sick and tired of taxes and tell us so repeatedly. I hope that the government is now going to introduce parameters that are just and fair for municipalities.

In this connection, we have suggested a number of changes that I hope will be implemented. An advisory panel has already been set up, that will advise the minister when there is a dispute with the municipalities. While we are on the topic, one thing we would really like to see is a lot of surveyors because they have the necessary specialization and will probably establish as fairly as possible what the federal government owes the municipalities.

This will also end arbitrary actions for once and for all. The city of Saint-Jean will be able to annually budget an amount that it can be sure to have, instead of the minister getting up on the wrong side of the bed one morning and closing a federal institution in a municipality and he no longer paying the taxes since it has been closed or he wants to sell it to someone else. Until it is sold, the municipality is in limbo, sort of, deprived of revenue from the federal government.

I think that if we want the minister to have a good advisory panel, this must include surveyors, and in order to keep this from ending up, as usual with the Liberals, as another patronage plum, or nepotism, it is also important for these people to be appointed by a public competition.

So, generally speaking, we are fairly satisfied to put an end to the arbitrariness. With the new measures, we feel the municipalities are going to be in a far better position to prepare their budgets efficiently, and I also hope the government will not take seize the opportunity to say “Now we have new parameters, we will reduce our transfers a little”.

We will keep an eye out for this. It is very important for those of us in the City of Saint-Jean and in the surrounding municipalities to be able to plan budgets properly year after year. There are many federal buildings and we want to ensure that the revenue from them will at least be the equivalent of what we were receiving before.

We hope these new parameters will mean more municipal revenue instead. It is important for me to speak on this matter today because of the importance of federal government buildings to the municipalities in the riding of Saint-Jean.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
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NDP

Nelson Riis

New Democratic Party

Mr. Nelson Riis (Kamloops, Thompson and Highland Valleys, NDP)

Mr. Speaker, I appreciate the opportunity to participate briefly in today's debate on Bill C-10.

More than anything else, this bill reminds us of that horrible time in Canadian history when the Conservatives formed the government. It is one of those points that we cringe to recall, but it is real. Those early years in the 1990s were terrible years for Canada, terrible years for Canadians and, quite frankly, a disaster for the House, with continuous contempt of parliament and a disregard for the rules and traditions of the House of Commons.

Topic:   Government Orders
Subtopic:   Municipal Grants Act
Permalink

February 11, 2000