As the N.W.T. changes how it funds communities, small communities will be the most impacted

The government of the Northwest Territories is changing how it funds its communities and those with the smallest populations will feel it most.

The Department of Municipal and Community Affairs (MACA) is starting its transition into the new funding model on April 1, 2025 and easing into it over a three-year period. 

The change is based on a review from 2014 that found communities with the smallest populations have been receiving a higher percentage of funding compared to larger communities. 

MACA Minister Vince McKay said that's led to some communities being underfunded to the point of not being able to operate. 

"This has to be fixed in order for new funds to come in instead of throwing money at a problem," he said Tuesday in the Legislative Assembly. 

In a written statement, the department said the updates would be a more equitable distribution of MACA's budget. It said the change will have the biggest impact on communities with fewer than 500 people.

Ray Ruben, mayor of Paulatuk — a community of about 300 on the Beaufort Sea — said it helps that the new model is being implemented over three years. 

"So it's not like if communities are going to face cuts, it'll be sudden," he said. 

Ruben said that gives them time to prepare for what they could be facing.

Ruben said the numbers of what funding his community is receiving aren't yet final, but he's telling some staff they might be looking at areas to cut in the coming months. 

According to senior administrative officers who have met with MACA staff to learn about the new model, communities choose from a list of plans that allocate different amounts of money to their operations and maintenance budgets, waste water and sewer and community public infrastructure. 

Soham Srimani, SAO of Nahanni Butte — a community of under 100 in the Dehcho region — said his community is opting to lessen its funding for waste water and sewer. 

"It's actually a concern I would say, but then operation maintenance is more of a concern for me because the power bills, insurance and whatnot," he said. 

Srimani said it's unlikely to impact residents' regular water and sewer services, but it limits their ability to deal with emergencies.