The government is plowing ahead with an idea to dole out municipal grants in quarterly installments rather than in one lump-sum payment per year.
Communities are concerned they couldn’t finance capital projects or would lose interest income if they were paid quarterly.
The government still wants the plan to go ahead.
The comprehensive municipal grant was discussed at last week’s Association of Yukon Communities meeting. As a result, Community Services decided to strike a committee to discuss the issue.
“The kiss of death on any issue is to send it to committee,” said Dawson councillor Wayne Potoroka.
He wants the government to stick with its lump sum funding scheme, but at least the government is engaging in a discussion, he said.
The idea to split the municipal grant into four chunks came from an auditor general’s review in 2006. It urged that approach for municipalities, non-governmental organizations and other government-funded groups.
“The recommendation from the auditor general is just that – it’s a recommendation, not legislation,” said Potoroka.
Municipalities should not be lumped in with other government funded groups, he said.
“If you were to poll the room at the (Association of Yukon Communities meeting) everyone would likely say, ‘Go back to the way it was,’” said Potoroka.
He can’t imagine how municipalities could operate on quarterly payments, he said.
“There’s so many municipalities that would be affected it wouldn’t make sense.”
Dawson needs 70 per cent of its funding up front to stay afloat, said Potoroka in April.
It’s the same situation in Watson Lake where capital projects would likely dry up, said deputy mayor Howard Fick.
“What they’ve suggested on the quarterly basis isn’t practical, it’s not doable,” he said.
“It will affect the way we do business.”
Even in communities where the funding situation isn’t as dire, such as in Haines Junction, the community loses out on interest payments.
Haines Junction makes up to $70,000 in interest per year, said Mayor George Nassiopoulos last month. It’s a big hit when that amount represents six or seven per cent of the yearly budget, he explained.
The government says it will be listening to concerns from each community.
“We have a commitment to work with Yukon municipalities to get information to the government before next fiscal year,” said Community Services director Christine Smith.
The committee will have representatives from three communities.
Fick would like to see all communities represented.
“Each municipality, although our needs are common, have unique issues throughout the territory,” he said.
The territory granted the municipalities a reprieve for the 2010 fiscal year, but is looking to introduce the quarterly funding next year.
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