What to Do About Villages...

There is currently a lot of media and council attention regarding two recommendations (among forty or so others) contained in a recently released report. The recommendations threaten to phase out Nova Scotia's 22 villages. Seven are located in Kings County. The village commissioners are very upset. They want the status quo to be maintained.

My goal

My goal is to figure out what structural changes are needed to provide residents of Kings County with the right governance model for an efficient government... One that's fair and equitable for everyone and offers high quality service at the lowest cost possible. 

My beginning point is that whether we live in communities organized as towns, counties, villages, growth centres or hamlets in the end won't matter... If we keep our focus on an end goal that results in a more nimble system. To me a nimble system is one that represents good value and that's open and welcoming to those who pay the piper. That's taxpayers like you and me.

The importance of an open mind

Currently no one has a crystal ball that shows what the best model of governance for Kings County is... All possibilities need to be thoroughly explored versus rejected out of hand.

Would an urban district that joins highly serviced areas like Coldbrook, North Kentville, Kentville and New Minas into one municipal unit make sense?

Are there advantages to forming one regional government to provide services to all the towns, villages, rural areas, etc.?

Could there be advantages to having towns and larger villages as the only municipal units with rural municipalities (counties) being directly governed by the province?

Would a 100% amalgamated model here in Kings mirror the success of the Region of Queens where towns, villages and the rural municipality amalgamated several years ago?

What the Provincial Municipal Fiscal Review says about villages

The fiscal review's recommendations regarding villages are captured in two recommendations:

#13 No new villages will be created and no new powers will be given to villages beyond those that currently exist.

#14 All incorporated villages in Nova Scotia should be phased out. Existing villages should be given the opportunity to apply for town status, merge with an adjacent town, or dissolve into their encompassing rural municipality as they see fit. [In Kings County, prior to the release of the fiscal review, New Minas was already weighing the option of becoming a town].

In short, the working group, largely municipal and provincial staff, came to these two recommendations through two key conclusions.

1. Villages create: “administrative redundancies”. Based on that, the report suggests that costs could be significantly reduced by eliminating villages as a level of government.
2. Village residents are doubly represented at the local level. They elect village commissioners. They also elect a municipal councillor. The municipal councillor can find him or herself in contentious situations where expectations are to represent the village commission point of view regardless of whether that may be the best position to take for the municipality as a whole.

The review reports that the average village uses 20% of its operating budget on administration. This percentage for the seven villages in the Municipality of Kings ranges from 9.3 to 27.6 percent. Those who pay village “administrative costs” also pay municipal “administrative costs”. The report suggests that most of the village administrative costs would be saved if villages were phased out and administrative duties were taken over by counties. 

Basically, villages not in a favourable position to become towns would loss the ability to charge property taxes and would no longer be incorporated under the MGA. In that scenario, village commissions and administration would cease, there would no longer be “village taxes” and assets and services would become the property and responsibility of the rural municipality (county).

If and when a village commission is no longer present the community would likely form a development and/or ratepayers association that would work with the county councillor on local issues. We already have that model in several growth centres, some of which are more densely populated than some villages. The municipality would apply rates to cover services residents receive over and above what other rural residents. This type of administrative structure is already in place for growth centres, etc., and the county's administrative costs would likely not increase too significantly while the village administrative cost would be eliminated.

The Municipality of Kings response to the Fiscal Review

As soon as the report was released Kings County villages were enraged. This was understandable as they rightly felt they deserved to be more directly represented in the decisions made. Unfortunately, they hadn't been given any advance notice of the recommendations either. 

Commissioner wasted no time. They appealed to Kings County to defend the status quo. Subsequently, two motions were passed at the November 4, 2014 Council Meeting:

1. Council does not support the sweeping recommendations stated in the Provincial-Municipal Fiscal Review at Recommendation #13 and Recommendation #14 and Council supports the continued existence of the Villages in the County of Kings.
2. Council directs the CAO to form a Working Group consisting of representatives from each of the Villages (as chosen by the Villages) together with three (3) Councilors representing the Eastern, Central and Western regions of Kings County (as chosen by Council) and the CAO which shall provide recommendations to Council and the Village Commissions with respect to the input to be provided to the UNSM by the December 15th, 2014 target date.

Looking to the future and not to the past

As Councillor for District 3, I voted against the first and for the second motion. Why? 

For me the first motion jumps too quickly to protect the status quo. As a trained sociologist, my standard is to base decisions on careful study and discussion before rejecting or accepting any recommendation. Secondly, and perhaps most importantly, Nova Scotia is at risk. Economics and demographics point to a great need for structural change.

Respect for the work completed to date

About forty recommendations have been brought forward in good faith after many years of study by a working group of the Union of Nova Scotia Municipalities. Our council is an active member of the UNSM and has been aware of the working group's progress towards its recommendations. To be fair to that process, I believe there is an obligation for the merits of the suggested changes brought forward to be be fully and respectfully considered. 

It's also notable that three towns, in addition to seven villages, partner with us to supply services to residents of the county. The towns appear to strongly support phasing out villages and/or having the villages become towns where appropriate. 

It's my perspective that our council is too focused on two of many recommendations. The working group approved at council's November 4 meeting is the only working group formed with councillors. The plan to arrive at our "overall" position is as follows:

1. November 25 (9:00AM to noon) Council will review the working group's input on the two village-related recommendations with staff presenting positions on close to forty other recommendations.
2. December 2 (6PM) the plan is for Council to pass motions. These will become the Municipality of Kings official position with respect to the draft provincial municipal review and its many recommendations. Then a “written submission” will be prepared.
3. December 15, the Municipality will submit its written position to UNSM.

Meanwhile the UNSM has organized a teleconference meeting where every rural councillor will have the opportunity to discuss the future of villages with their counterparts across Nova Scotia. It's unfortunate that the council workshop will take place before the opportunity (on November 26) to hear from other counties, UNSM, and provincial staff. 

If you want more details about the fiscal review's conclusions regarding villages I've included a summary from the policy department of UNSM below.

Please do not hesitate to keep in touch on this issue or any other issue. The opportunity and time for input is very limited but I can always be reached at 902.670.2949. Your questions and opinions are valuable to me, especially during these changing times.

SUMMARY FOR NOVEMBER 26 2014 DISCUSSION AMONG

ALL RURAL MUNICIPALITIES AND UNSM STAFF

There are 22 incorporated villages in Nova Scotia, located across 11 rural municipalities. Nova Scotia villages are represented by the Association of Nova Scotia Villages; they are not members of the Union of Nova Scotia Municipalities. The following information was considered by the Fiscal Review Working Group in developing recommendations 13 and 14.

Financial Viability: Villages are not obligated to provide any services. They choose which services to provide, whereas as Towns or Rural municipalities are required to provide certain core services, including roads and police services. If a village commission is under financial strain, it has the ability to cede any services it provides to the encompassing rural municipality. As such, it is not the financial viability of villages that is in question but rather, the value of two-tiered government.

Two-Tiered Government: Villages represent a second level of local government, occupying the same jurisdiction as their encompassing rural municipality, which are enabled to provide all of the services that villages currently provide. This additional level of government has associated administrative costs to taxpayers, estimated at around $80 per household per year.

• Independently elected representatives for the same constituents can have different mandates and priorities. When these representatives occupy the same sphere of jurisdiction, this can result in conflict between the two tiers.
• Accountability can be degraded due to confusion over which tier provides a particular service.
  Rationalize Structure of Local Government: Historically, villages were created as a structure of government to provide services (e.g. water and wastewater services) that rural municipalities were unable to provide. Current legislation allows towns and rural municipalities to provide the same services, and can do so at the community level through application of an area-rate tax. This option has the potential to increase efficiency and improve value to taxpayers.

Financial Reporting: Villages are required to provide audited financial reports to the Department of Municipal Affairs on an annual basis, but are not required to submit the information used to calculate the Financial Condition Index (i.e. the Financial Information Return – FIR, or the Statement of Estimates - SOE).

LEGISLATION Service Provision

• Villages in Nova Scotia occupy a wide spectrum of population, capacity, reporting, and level of service delivery.
• Unlike towns which are required to provide particular services, villages are able to choose those which they provide, with some offering only sidewalks (construction, maintenance and snow removal), beautifications and streetlights, while others offer far more including:
  • Fire protection and emergency services
  • Sidewalk construction and maintenance
  • Snow and ice removal
  • Water, sewer or drainage system
  • Recreation programs
  • Beautification
  • Crossing guards
  • Street lights
• In general, Police Services, roads and garbage collection are provided by the encompassing rural municipalities.

Elections

• Villages are governed by a commission consisting of 3 to 5 commissioners, with the exact number being determined by village by-law.
• The MGA permits the election of commissioners at the annual village meeting (or on a separate day as established through village by-law) for a 3 year term, and each village commission has a chair and a vice-chair.

Legislative Powers

• Villages are granted taxing authority similar to municipalities under the MGA; indeed, villages have virtually all the same powers granted to municipalities except those related to municipal planning.
• Historically, village status was a necessary precondition for communities within a rural municipality to be able to raise tax revenue and pursue certain social goods that rural municipalities were legally unable to provide (e.g., water and wastewater services).
• Villages have been incorporated under general legislation since 1923, however, since the Municipal Government Act (MGA) came into effect in 1999, it has not been possible to incorporate any new ones. Currently the only way for a new village to be incorporated is for a town to dissolve into a village.
• A village may be incorporated into a town by applying to the Nova Scotia Utility and Review Board. The application may be made by one third of the residents of the village.

Budgets and Financial Reporting

• Based on the village financial information submitted to DMA, in 2012, villages collected $9.5M in total revenues, $6.9M of which was property tax revenue from residents. Their expenditures totaled $8.7M that same year.
• The average portion of a village budget dedicated to public administration is about 20%, which is roughly the same as the average for towns.
  • On average, village residents pay an additional $80 (approximately) per household to support the administration of their village.
• Most villages contract their encompassing municipalities for tax collection services, and most municipalities charge a fee for this service (a per cent of collected amount). The villages of Kingston, New Minas and Canning however, collect their own taxes.
• The two largest villages in terms of budgets (New Minas and Bible Hill) collect 53% of all village property tax revenue and make 46% of the total expenditures.
• Villages have not historically been required to submit financial reports to the Province with the same level of detail as municipalities (FIR and SOE are not required, but audited financial statements are). As such, it is difficult to assess how effectively they deliver services.

Additional Statistics

• 5 villages collect 76% of all the village property taxes,
• 5 villages make 72% of village expenditures,
• Bible Hill, New Minas and Chester all have taxable assessments that exceed the smallest 20 towns,
• In 2012, 8 villages did not file financial reports with the Department of Municipal Affairs. Of those 8, 5 villages have not filed financial reports in at least 5 years.
• An annex to this note includes statistics on all 22 villages for comparison purposes.

WORKING GROUP CONSIDERATIONS

• Under the MGA, rural municipalities now have the same authority to provide services as towns. Furthermore, rural municipalities are able to levy area rates to provide additional services that local residents may request from their council.
• The PMFR Working Group was of the opinion that village powers have been rendered moot by the authorities granted to rural municipalities under the MGA.
• The PMFR Working Group considered two-tiered municipal government as part of the jurisdictional scan and research supporting the structure options paper. Overall, two-tiered municipal government has been phased out in Canada, with some notable exceptions (e.g. British Columbia).
• In those jurisdictions where it has been phased out, this was done for similar reasons to those considered by the Working Group in putting forward recommendations 13 and 14, in particular:
  • Independently elected representatives for the same constituents can have different mandates and priorities. When these representatives occupy the same sphere of jurisdiction, this can result in conflict between the two tiers.
  • Accountability can be degraded due to confusion over which tier provides a particular service.
• Additionally, the principles of reducing duplication and rationalizing government structures are supported by the recommendations of the One Nova Scotia Report (i.e. Recommendation 18).
• It was the opinion of the Working Group that the services currently provided by villages could, in many cases, be provided by the encompassing rural municipality within the general rate, or by an area rate. This has the potential to increase efficiency and improve value to tax payers.
• The Working Group acknowledged the value of local community representation. However, it was felt that those needs could be met in other ways, including:
  • Community Councils
  • Ratepayer Associations
  • Downtown Business Associations
• Furthermore, increased support for these forms of local representation could allow for communities without an existing village structure, within a rural municipality, to more fully represent the interests of their community as well.
• According to the MGA (s. 448), the Minister may dissolve any village upon request of the following:
  • Village commission;
  • A municipality (if there has been no meeting of the electors of the village for at least two years; and 90 days notice of the proposed dissolution has been served to the latest village commissioners and clerk, and no objection to the dissolution has been filed with the Minister); and
  • The Nova Scotia Utility and Review Board may dissolve a village on the request of not fewer than ten percent of the electors in the village.

APPENDIX

Village	Assessment 2013 ($)	Dwelling Units*	Taxes Collected (2012)	Public Admin as % of Total operating Budget**
Aylesford	40,757,000	1038	$77,283	16.2%
Baddeck	85,563,500	882	$399,630	9.7%
Bible Hill	261,073,300	3650	$1,670,435	23.5%
Canning	41,645,600	1035	$128,784	9.3%
Chester	340,900,300	1075	$646,347	8.3%
Cornwallis Square	253,324,200	-	$305,925	12.3%
Dover**	-	-	-	-
Freeport	16,280,900	-	$46,967 (2010)	18.9% (2010)
Greenwood	155,508,600	2142	$327,540	27.6%
Havre Boucher	-	590	-	-
Hebbville	Not reported	780	Not reported	Not reported
Kingston	194,540,400	2170	$550,666	21.5%
Lawrencetown	27,945,900	783	$179,989	13.8%
New Minas	357,428,200	2393	$1,991,825	19.7%
Port Williams	123,308,600	667	$314,601	13.7%
Pugwash	52,263,300	606	$163,763 (2013)	39.5% (2013)
River Hebert	21,330,573	595	$10,097	34.9%
St. Peters	Not reported	643	$182,247	18.8%
Tatamagouche	36,469,400	918	$152,699 (2011)	17.7% (2011)
Tiverton	7,300,100	-	Not reported	Not reported
Westport	13,949,200	-	Not reported	Not reported
Weymouth	24,934,500	769	$36,293 (2011)	15.4% (2011)

Assessment data on villages is from 2013. All values are Capped total assessment.

* 2011 Data from Community counts, – indicates data unavailable.

** Dover is a village in name only. Services are provided by the municipality.

Note on Data Sources for Structure Options Paper (Recommendations 1-14):

To inform the Structure Review Recommendations, the following information was collected:

• Literature Review
• Jurisdictional Scan
• Community Counts (Department of Finance and Treasury Board Office)
• Annual Financial Reports submitted by municipalities and villages to the Department of Municipal Affairs
• Rural Municipality and Village Websites for village area rates
• Assessment Data (PVSC)
  • Village Assessment Data retrieved from rural municipalities / villages
• Financial Conditions Index (Department of Municipal Affairs)
• Census Data (Statistics Canada)