Fight against legislation to favour CBRM in port development goes to law amendments committee

By Helen Murphy    
March 28 2018

GUYSBOROUGH – The Municipality of the District of Guysborough and the Strait Area Chamber of Commerce were among those appearing before the N.S. Legislature’s law amendments committee on Monday to argue against proposed changes to the Municipal Government Act that would favour Cape Breton Municipality in port developments. The changes would allow CBRM to sell land at below market value for industrial projects at the port, such as a proposed container terminal, and offer tax concessions to developers.

The bill, which has passed second reading in the legislature and is now with the committee for review, has caused a furore in the Strait Region, where the Melford International Terminal is planned. Melford project proponents have already paid market value to MODG and the provincial government for the land they want to develop. Richie Mann, VP Marketing for Melford, told The Journal earlier that the province drove a hard deal for the land.

In his opening remarks before the Law Amendments Committee, MODG Warden Vernon Pitts talked about the many benefits brought to the municipality because of the Sable Offshore Energy Project.

“Our position related to Sable and any other development proposed for the municipality has always been that we expect investors to be good corporate citizens — and to pay taxes like anyone else doing business in our community.”

He pointed out that because of the Sable project, MODG has been able to diversity its sources of revenue and diminish its reliance on property tax. Pitts explained that property tax amounts to 35 per cent of MODG’s annual revenue, with the balance coming from its business operations, such as Sable Wind, the landfill operation and industrial property transactions.

The warden added that final investment decisions on other major industrial projects proposed for the municipality, valued at $11 billion, are due to be made in 2018.

“We have invested millions of taxpayers’ dollars in preparing the investment climate,” he told the committee. “We have had numerous property transactions with the Province of Nova Scotia and with private land owners to acquire land for development purposes. Every piece of property we acquired or sold was at market value. No credible, responsible developer has ever complained about paying market value for land. In fact, it has been our experience that those seeking incentives such as land or tax breaks are simply non-viable business ventures — anyone can start a business and promise to create jobs if government removes the risks.”

If the bill is passed, Pitts said, future investors who have chosen to come to N.S. will simply shop their project around to municipalities to see where they can get the most concessions.

“How does Nova Scotia win in this scenario?” he asked.

“With this legislation and the minister’s intent to allow other municipalities to have the same ability, the official ‘race to the bottom’ has begun.”

Pitts added that if these legislative amendments go forward, the Province of N.S. and the Government of Canada face major financial impacts, “as the affected investors have a right to make a claim to a NAFTA tribunal for their losses.”

The Strait Area Chamber of Commerce appeared before the committee later Monday afternoon. They said these amendments would take away the level playing field ensured through the current MGA, and fly in the face of the Ivany Report. That report called for cooperation and collaboration to help build the province’s economy.

In a March 23 letter to Premier Stephen McNeil and Minister of Municipal Affairs Derek Mombourquette, Chamber Executive Director Amanda Mombourquette said, “This bill will start a negative chain reaction where municipalities are pitted against each other, where investors lose confidence in a government that changes the rules part way through the game (even after tens of millions have been invested), and where unsustainable business models will be propped up on the backs of taxpayers.

“Premier McNeil and Minister Mombourquette, there lies still time to halt this process and do the right thing — postpone the passing of this bill and reopen the consultation process to ensure that impacted municipalities and businesses are consulted and that their concerns are addressed,” she wrote.

Inverness MLA Allan MacMaster criticized Strait Area MLAs Lloyd Hines and Randy Delorey for remaining silent on the issue. “I would like to hear from the members for Guysborough-Eastern Shore-Tracadie and Antigonish. I say that because I want to hear how they think this legislation is fair to the private investment that has already been made at Melford in the Strait Area, which I will remind the minister is also part of Cape Breton Island," he said in the legislature.