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Pasloski's first budget: back to black

The Yukon government will post a modest surplus of $29 million this year, returning to the black after two years of deficits.

The Yukon government will post a modest surplus of $29 million this year, returning to the black after two years of deficits.

Yukon Premier and Finance Minister Darrell Pasloski announced this during Thursday’s budget speech - an event largely upstaged by a crowd that packed into the gallery to protest the government’s effective rejection of the plan to protect the Peel watershed.

The territory plans to spend $1.156 billion over the coming year - making this the biggest budget ever. And with growing revenues,the government expects to post an $80-million surplus next spring.

That’s largely thanks to transfers from Canada that are set to grow by $78 million to $963 million. Population growth fuels this growth in transfers. Over the last five years, the territory’s population has swollen by 11.7 per cent, the highest increase in Canada.

While most jurisdictions owe money, the Yukon has net financial resources - referred to by territorial politicians as a “savings account” of $49 million. Only Alberta shares this distinction of carrying no net debt.

But Pasloski urged caution, noting scenarios in which the territory may need to dip into this rainy-day fund.

Ottawa’s stimulus spending is winding down. Some federal health funds may also disappear and the future of the Shakwak agreement, under which the U.S. helps pay for upkeep of the north Alaska Highway and Haines Road, is also unclear.

The courts may uphold an order for the territory to build Whitehorse’s francophones a new high school. Whitehorse General Hospital’s emergency room also needs to be expanded.

A growing capital is expected to need “one and perhaps two” new schools, on top of the new F.H. Collins, said Pasloski. And a hot economy will put growing pressure on the territory’s energy, transportation and communication infrastructure.

The budget includes no tax increases and few surprises in spending commitments.

“We ask for patience in that we cannot meet all our commitments in one budget,” said Pasloski. “We have a five-year mandate, with many more budgets yet to come.”

The territory’s current surplus is buttressed by $13 million in unspent federal funds earmarked for affordable housing. That remains after the territory committed $4.5 million to build 10 units of second-stage housing, for women fleeing violence over the next 18 months.

The territory should have already spent the remaining housing money to ease the territory’s housing shortage, said the Liberals’ Darius Elias in a release.

“In the middle of a housing crisis, when Yukon families are struggling to find affordable and available housing, this is deplorable,” he said.

Capital spending will drop this year by $14 million, to $232 million, with fewer big projects like the newly built Whitehorse Correctional Centre on the books. Construction of a new F.H. Collins High School won’t start until next year due to design delays announced in December.

The territory will spend $35 million on land development. Of that, $25 million will go towards completing the first two phases of Whitehorse’s next big, new neighbourhood, Whistle Bend.

Lots will begin to hit the market this autumn. The government will spend an additional $3 million this year to design phases three through five. The subdivision was designed for 8,000 people in all.

Some of the budget’s other bigger spending commitments include:

* $33 million in roadwork to repair sections of the Campbell Highway, Klondike Highway, North Canol Road, Atlin Road, Takhini Hotsprings Road, Silver Trail, Dempster Highway, and others.

* $7.3 million for a new ambulance base in Whitehorse.

* $7 million to build a new recreation centre in Ross River.

* $2.4 million to replace the RCMP’s Whitehorse cells with a unit attached to the new jail.

The government will also begin planning to replace the Sarah Steele Building in Whitehorse to offer an expanded detoxification program for addicts, and continue to fund the Kwanlin Dun First Nation’s land-based treatment program.

Pasloski predicted that the territory’s economy will heat up in the coming decade as more mines open up and create new jobs. But he acknowledged this mining boom will put pressure on the territory’s growing shortages of housing and electricity.

Natural gas is touted by the premier as a cheaper, cleaner alternative to burning diesel.

To bolster the Yukon’s Internet networks, the territory will look at “the potential construction of a second fibre-optic link from Whitehorse to the south to provide redundancy,” said Pasloski.

The new link could either be routed from Carcross to Skagway, connecting with Juneau and Seattle, or up the Dempster Highway to Eagle Plains to a satellite link, said Pasloski.

The entire government, including its Crown corporations, is carrying $129 million in debt. That’s largely because of borrowing done to build hospitals in Watson Lake and Dawson City and to expand Mayo’s hydroelectric dam.

This borrowing remains well below the government’s new borrowing limit of $400 million, recently raised by Ottawa from $300 million.

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