P.E.I. leaders gather, discuss revenue sharing agreement
56th annual meeting of P.E.I. Federation of Municipalities took place in Cornwall
Municipal leaders from across the Island gathered in Cornwall Monday for the 56th annual meeting of the P.E.I. Federation of Municipalities.
High on the list of concerns is money and a contentious new revenue sharing agreement with the province.
Island municipalities had asked the province for the same thing municipalities in other provinces receive under the HST, rebates worth about three quarters of the tax they pay. Instead, the P.E.I. government is offering $1.8 million in infrastructure money to be shared by all municipalities.
The provincial government has frozen grants and cash transfers to municipalities for the past year while they negotiated the new revenue sharing agreement.
"We’re probably here, they’re there, but there’s got to be somewhere in the middle where we can get some common ground," said Bruce MacDougall, president of the Federation of Municipalities.
Leaders from more than 70 communities around P.E.I. had the chance to speak face to face with most of the Liberal cabinet ministers during the meeting but Finance Minister Wes Sheridan was out of province.
A working committee came up with a plan two months ago but Sheridan rejected the plan.
Sheridan told the committee there is less equalization money from Ottawa. Last year, Sheridan cut municipal grants by 3 to 5 per cent.
"We hear the feds telling us they're increasing their grants to P.E.I. and then we hear the province saying they’ve got fewer dollars and that’s why they’re going after the municipalities for 3 per cent and the 5 per cent, so it’s hard to figure out exactly which is which," said Summerside Mayor Basil Stewart.
Revenue Minister Gail Shea said federal transfers have increased by 50 per cent since 2006 — that’s a $100 million increase to P.E.I.
"Federal government is not balancing their budgets on the backs of the provinces because transfers to the provinces have continued to increase," said Shea.
Communities like Souris are left with much uncertainty about this year's budget and how the town will be compensated for higher costs due to the implementation of the HST.
"We’re just not sure where some of these things fit, so yeah, we’re a little bit mixed up and concerned," said Souris Mayor David MacDonald.
Fisheries Minister Ron MacKinley filled in for Wes Sheridan during the meeting..
"Like we as a province ... we can’t be Santa Claus all the time," said MacKinley. "And some of the groups haven’t come to agreement yet of how to divide up this particular fund."