Hello Folks. We have written the Premier’s of BC (David Eby) and Newfoundland (Andrew Furey) as they consider taking the Federal Government to court on equalization. We wanted to take the opportunity to show them both just how manipulated the equalization program is in Canada. We have included the letter that we are waiting for the Justice Minister and Attorney General of Canada to answer to fully provide the two Premier’s with the information they may need as they consider legal action against the Federal Government. Most of you have seen the lower part of this letter before. Thank for following and as usual, we will let you know if we hear anything back. Stay cool today. The NSEF Dear Premier’s, Eby and Furey. While you both address the Federal Government about the issue of the federal equalization program, we want to let you know what has been happening in Nova Scotia for over 30 years now and the unfairness surrounding the equalization manipulation in this province. When it comes to equalization fairness in Nova Scotia, there simply is none. We have enclosed a document/letter that has been sent to Justice Minister Virani well over a year ago, which has never been answered. To be honest and fair, his predecessors have never answered similar letters either. Section 36 of the Constitution Act, 1982 is very clear on the intended purpose of equalization in Canada, and yet, our government allows the provinces to not follow this constitutionally enshrined commitment to Nova Scotians. This year, Nova Scotia will receive $3.284 Billion in equalization and the province only takes $30 million of this amount from the $3.284 billion to distribute to those municipalities and towns that generate the entire transfer. Then the remainder or $3.254 billion will be deposited into “General Revenue” with no accountability or transparency to Nova Scotians of where this funding is spent. Currently, the CBRM and other areas of rural Nova Scotia are paying the highest property taxation rates in North America while the Federal Government turns its back on Nova Scotians and allows this federal program to be manipulated because of party politics. Gentlemen, can you imagine the situation Canada would be in if big business and politics allowed every province, urban and rural areas, to flourish as intended with the equalization funding? Unfortunately, the opposite is happening in Nova Scotia as the residents watch as the Halifax capital region grows and develops faster than most cities in Canada while places like the CBRM pay more than double the property tax rates than that of Halifax Capital Region. Our group, the NSEF or the Nova Scotians for Equalization Fairness has focused on and investigates one of the five categories in the federal government’s formula that makes up the total transfer. This category funds the municipal deficiency in the tax capacity related to property taxes and miscellaneous revenues. This year, this category generated over $650 million, but the provincial government has refused to explain how only the $30 million it provides is adequate and, more importantly, pursuant to section 36 of the Constitution Act, 1982. Gentlemen, we have witnessed this important program for Canadians being manipulated and misappropriated by politicians, lawyers, and judges, which has ruled that only the two parties who were privy to what is represented by section 36 can legally address this issue. This bizarre ruling still exists, which means that the government is the sole authority to decide whether to comply with the supreme law of Canada: Our Constitution. All have ignored a prior 1950 ruling by the Supreme Court of Canada which states “The Constitution of Canada does not belong either to Parliament, or to the Legislatures; it belongs to the country and it is there that the citizens of the country will find the protection of the rights to which they are entitled” Our attachment submitted to the federal justice minister will describe the difficulties we have encountered in our efforts to hold governments accountable for their obvious lack of transparency regarding their rhetoric and their own data online. Premier’s Furey and Eby, we wish you the best in your pursuit for fairness with regards to the Federal Equalization Program. We are available should you require any of our 30 plus years of data into our investigation into this program. Best regards, The Nova Scotians for Equalization Fairness Here is the letter we are waiting for a response to from Ottawa: Dear Justice Minister Arif Virani: Congratulations on your important appointment as the federal Minister of Justice and Attorney General of Canada. We wish you success in your new government assignment. Regarding your new important job, we want to raise two legal points about the federal government’s equalization program in Nova Scotia to show how these billions of federal equalization dollars are not being used in the interests and benefit to all Nova Scotians. To begin, this is a quote taken from a 1950 constitutional case involving the federal and Nova Scotia provincial governments who were trying to do a bit of constitutional flipping of the jurisdictions exclusively assigned in 1867, and, in which, both parties involved were denied their legal request by the Supreme Court Of Canada with the following ruling: “The constitution of Canada does not belong either to Parliament, or to any of the Legislatures; it belongs to the country and it is there that the citizens of the country will find the protection of the rights to which they are entitled.” (p.34) https://www.canlii.org/.../1950canlii26/1950canlii26.html This unequivocally clear and strongly worded message from the Supreme Court of Canada, however, was ignored by a lower court, unintentionally or otherwise! In the 2009 Nova Scotia Appeal Court constitutional case, involving the Cape Breton Regional Municipality (CBRM) and the Nova Scotia government regarding the inadequate provincial equalization funding grant to municipalities by the provincial government, Chief Justice Michael MacDonald made the following ruling: “Interpreting s. 36 – Conclusion [86] The cumulative effect of answering Professor Sullivan's three questions is inevitably as follows. In an appropriate context, ‘s. 36 might represent a justiciable commitment, but only among the federal and provincial governments’ (my emphasis) who were privy to the agreement that is represented by s. 36. It is not actionable by an individual or municipality such as CBRM. Yet this is something the CBRM would have to establish if this matter were to proceed further. Therefore, this proposed interpretation respectfully offers no chance of success.” https://www.cbrm.ns.ca/.../Appeal_Decision_CBRM_vs... Minister Virani, doesn’t this development raise several problems from a legal and democratic perspective? Was the former Chief Justice MacDonald instructed to make a ruling that would forever terminate any further future legal challenging of how only the two levels of government are manipulating the distribution of these federal equalization payments? Hasn’t the supremacy of the Constitution expressed in section 52 and the 1950 earlier Supreme Court Of Canada ruling been seriously undermined and, more importantly, overruled? What about the undemocratic and extralegal political coup that only government possesses the constitutional power to decide whether it will comply with its enshrined commitment in section 36 of the supreme law of this country? And from a jurisprudence perspective, does this even sound like a proper legal ruling in a country which asserts it is a democracy governed by the rule of law? Minister, this appears to be a bizarre legal decision when a high court rules a government can usurp ownership of a constitutional power that the Supreme Court of Canada earlier decided that in a constitutional democracy only “belongs to the country and it is there that the citizens of the country will find the protection of the rights to which they are entitled.” The second point: The equalization payments are 100 percent a federal program in terms of its design, implementation and financed from federal taxation. Given this, it is questionable what actual power or input the Appeal Court of Nova Scotia can attribute to the provinces as to what is represented by section 36 or to the existing equalization formula, which, however, is the federal government’s factual manifestation of its funding being pursuant to section 36. However, and more problematic legally and democratically, what was the purpose of the federal government in its intervention of an “unconditionality” to these equalization transfers, particularly after the enshrinement in the Constitution Act, 1982? An intervention that the federal government has not produced the constitutional reference which would legalize this practice. Recently in a May 19, 2023, political audited recorded meeting of a Cape Breton member of parliament regarding the unconditionality of the federal equalization program in which Mike Kelloway provided a legal document by legal scholar Ayment Nader, which was published in the Dalhousie Law Journal. M.P. Mike Kelloway reassured us that section 36(1) was the legal source he found which legalizes the federal unconditional transfers. However, M.P. Kelloway’s legal source does not support his opinion, and, in fact, the legal scholar Nader unequivocally states in his legal paper section 36(1)(c) can only be federally administered by a “conditional” grant or commitment. That document of legal scholar Aymen Nader which was provided by M.P. Kelloway is as follows: “Providing Essential Services: Canada’s Constitutional Commitment Under Section 36” (1996) 19:2 Dal LJ 306. M.P. Mike Kelloway has not replied after being informed of his constitutional misinterpretation error. Minister, the federal government’s constitutional responsibility does not end with the equalization transfers to the provinces, as its correspondence tries to argue. The federal government’s Pontius Pilate washing of the hands is, instead, being legally irresponsible because the federal government knows the provincial government in Nova Scotia refuses to provide any transparency or accountability to its citizens for decades by responding these transfers are “unconditional”. The federal government is accepting a flawed ruling by CJ Michael MacDonald, which is more a matter of promoting and legalizing this political manipulation of these federal equalization transfers than governing by the rule of law. Because the ownership of section 36 of the Constitution Act, 1982 is not the exclusive preserve of any government so that it alone can decide to claim its ignoring of its constitutional commitment to the people is somehow “legal.” Minister, the formula consists of five categories, and it is important to focus on one of them which deals with the municipal deficiency in tax capacity related to property taxes and miscellaneous revenues. This one municipally related deficiency in tax capacity generated over $600 million of this year’s total transfer of $2.803 billion. Yet, the provincial equalization grant (now called the Municipal Financial Capacity Grant) has remained unchanged for years at $30 million. Yes, the visual manifestation of these federal equalization transfers being manipulated is that the Halifax Regional Municipality is obviously the main area being developed in Nova Scotia with these equalization transfers. The wording of section 36: to provide reasonably comparable public services at reasonably comparable levels of taxation is related to the category in the formula, in which, each year, the federal government is now sending over $600 million to enable municipal units to achieve that national standard. The underfunding of municipal units outside the Capital Region of the Halifax Regional Municipality, was reported in the Union of Nova Scotia Municipalities’ report, “A Question of Balance – An Assessment of the State of Local Government in Nova Scotia” - April 2005. This report was prepared by Dr. Paul Hobson, Department of Economics, Acadia University, Dr. David Cameron, Department of Political Science, Dalhousie University, and Dr. Wade Locke, Wade Locke Economic Consulting. This report says the provincial government’s equalization grant funds approximately 40 percent of a municipalities normal expenditures and therefore municipal units are unable to meet their constitutional obligation to provide reasonably comparable local expenditures at reasonably comparable tax rates. (p. 71) This inadequate provincial equalization grant is still in effect. Since that time, 5-towns have had to dissolve, and many other municipal units are struggling financially to survive. Why? The provincial government’s policy is to promote the Capital Region’s economic development while underfunding rural Nova Scotia and the Cape Breton Regional Municipality in which the manipulation of these equalization transfers provides the irrefutable evidence. Instead of the federal equalization being used as a helping hand to improve all communities as stated in the constitution, it is being manipulated to ensure the federal equalization transfers will never end. Why is the federal government allowing this to happen? When the federal government sends sufficient funding to address these municipal fiscal deficiencies, it then undermines its own constitutional commitment and creates this municipal underfunding outcome with its “unconditional” transfers. How is this constitutional? And despite numerous requests, no legal authority has been cited by the federal government that sanctions this unconditionality practice. The federal government’s correspondence is irresponsible, too, when it is trying to defend this practice and then adding this nonsense that it is the responsibility of the citizens to hold its provincial government accountable. The federal government is further irresponsible when it knows this unconditionality factor prevents the citizens of Nova Scotia from being able to hold the government accountable. Surely, the federal government is not suggesting that requiring the receiving provincial governments to maintain and provide proper accounting reporting for these federal equalization expenditures within Nova Scotia is considered by the federal government as involving interference or altering some provincial jurisdiction? Without any requirement for standard practices of full transparency and accountability, both the federal government and the provincial government cannot produce any documentation that their equalization policy is pursuant to section 36 of the Constitution Act, 1982. And that, sir, is a “supreme crime against half the population of Nova Scotia and our constitution!” As the top legal policeman for this country, can you confidently and officially say to Canadians that the federal government’s unconditionality policy’s outcome in Nova Scotia of its equalization program is pursuant to section 36 of the Constitution Act, 1982? What official data is there to prove both levels of government are in compliance with “their” enshrined commitment pursuant to section 36 of the Constitution Act, 1982? Minister, isn’t it time to legally correct this federal program to ensure rural Nova Scotians and residents of the Cape Breton Regional Municipality are fully and legally recipients of their constitutional rights enshrined in section 36? Yours truly, Charles W. Sampson Fr. Albert Maroun, PhD Russ Green On Behalf of: The Nova Scotians for Equalization Fairness Board