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March 2018 – Municipal Charter Threatens Economic Future of Nova Scotia
A topic has hit the legislature that is designed to pit one region of our province against the other, and favor one port development opportunity over another. Bill No. 85 – an act to amend the Municipal Government Act with specific charter powers for CBRM.
LOSING A LEVEL PLAYING FIELD
A bill is on the docket that could result in CBRM having the kind of economic development powers at their disposal that have not been seen since the 1990’s in Nova Scotia – leaving the rest of us behind and resulting in the loss of a level playing field for economic development efforts in the province. Specifically the bill will allow CBRM to provide private businesses with tax exemptions, abatements, and land-giveaways – something no other region will be able to compete with when trying to attract/retain investment. The result will be regions working against each other in a race to the bottom. Revisions to the Municipal Government Act halted those practices in the 90’s in order to create a level playing field and to focus on doing business with the world, instead of competing with each other.
FLYING IN THE FACE OF THE IVANY REPORT
The bill introduced last week in the provincial legislature flies in the face of the Ivany Report’s forward-thinking plans, and sets us back 30 years. The One Nova Scotia report, and the efforts that have followed it, have been well-intentioned; not perfect, but full of progressive ideas to improve our economy. One of the most impactful legacies of that report has been that all regions of our province are working together to advance our economy.
STARTING NEGATIVE CHAIN REACTION
Although the CBRM motivation is clearly about port development, the impact will be felt much more broadly in terms of our ability to attract investment to rural Nova Scotia.
- Inevitably, municipalities will be pitted against each other in the face of these sweeping economic development powers for a select few.
- Investors will lose confidence in a government that does the opposite of creating winning conditions for business as recommended in the Ivany report – changing rules in mid-stream and in this case, creating government-enabled competition, which this legislation is doing.
- Unsustainable business models will be propped up on the backs of taxpayers and small businesses (in this case especially, when you keep in mind the continued need for dredging and the estimated $100 million cost to upgrade the rail line).
LEARNING FROM THE PAST
The proposed municipal charter for CBRM will result in the creation of a false economy and dependency for that region, similar to the days of the steel and heavy water plants. It will be a race to the bottom for all regions of the province as municipalities will need to pursue their own special deals with the province just to remain competitive and on a level playing field. Bill #85 goes far beyond providing subsidies to a questionable business model – in effect it demonstrates favoritism for one port development project over another.
RACING TO THE BOTTOM
How will your municipality/region compete? Will they negotiate their own best deal? Of course – because they have a responsibility to offer attractive investment conditions to potential new business. But so will their neighbours, and their neighbour’s neighbours (case in point – Guysborough reluctantly prepares for the inevitable Race to the Bottom). At a time when we are on the edge of prosperity with clear goals from the Ivany Report and balanced budgets in this province, the inevitable result will be a RACE to THE BOTTOM.
CONTACT YOUR MLA
Ask your provincial representative – how does this proposed legislation support the Ivany Report principles and create a level playing field? Encourage further modernization of the Municipal Government Act, without major exceptions like this. Let`s focus on creating globally-competitive infrastructure and cost structuresacross the entire economy, and ensuring access to an appropriately trained workforce, so that all ships rise in Nova Scotia’s economy. Find your MLA here: https://nslegislature.ca/members/profiles-table.