Ian Petrie is one Islander who knows a lot about IRAC, but even he is baffled by the secrecy. This was written a year ago and is very much still relevant.
You’ll want to tune in to Landlines next Monday to hear Ian’s chat with Boyd on this very topic.
Can Islanders Gain More Confidence in IRAC?
No one likes umps in baseball, refs in hockey. And just think if they had control over the price of gas, how much your rent could increase, or the price of electricity. Welcome to the world of IRAC.
The Island Regulatory and Appeals Commission began in 1991.
Several existing regulatory agencies the Public Utilities Commission, the Land Use Commission, Office of the Director of Residential Rental Property and more were rolled into one. For some reason it operates under the Department of Education.
IRAC’s commissioners are appointed by cabinet and for most Islanders remain faceless and unknown. Despite this they certainly need a thick skin. IRAC is never praised publicly but can quickly become a lightening rod for criticism when the price of gas takes a jump, rents or power rates go up. Politicians like IRAC because it acts as a useful buffer between them and their constituents.
A lot of IRAC’s regulatory work is linked to hard data: the wholesale price for petroleum products in New York, what Maritime Electric has to pay New Brunswick for power, what landlords pay to heat their buildings and so on. However there is one important role it plays that also involves some judgement and determination, and thats administrating the Lands Protection Act.
We all know the numbers: ownership limits of 1,000 acres for individuals, 3,000 acres for a corporation. We also know that innovative and complex shareholder structures have been used to try to get around these limits. While Executive Council has the final say in land purchases IRAC does the heavy lifting sorting through applications and making recommendations to cabinet.
There are many Islanders (including me) and groups worried about the rising cost of land and the growing inability of Islanders to compete for it. Organizations like the National Farmers Union and the Coalition for the Protection of PEI Lands insist that the spirit and intent of the LPA, to ensure wealthy individuals and corporations don’t monopolize land purchases and prevent average Islanders from owning land, simply isn’t being honoured. The Coalition goes further and has demanded an Island-wide public inquiry to look at all land transactions. Purchases by the Irving family and Buddhist organizations in Eastern PEI have been especially controversial.
What stokes a lot of this distrust is the cloak of secrecy over the information IRAC gathers and how its considered. In Land Matters, the latest public inquiry into land issues released in 2021, this issue of transparency was mentioned several times: “The Committee heard that greater transparency is needed in the administration of the Lands Protection Act. It is noted that accurate, up-to-date information regarding land ownership is not always easily accessible to the public….. Greater transparency would promote accountability and public confidence in the administration of the Lands Protection Act.”
IRAC does provide a lot of information on its website: every application it receives, location, who’s selling, who wants to buy, size, etc. and the final decision by cabinet once it’s made. What isn’t made public are the recommendations IRAC makes to cabinet, While IRAC takes the heat for this the system is really designed to provide cover for the government. If the reasons for IRAC’s recommendations are kept confidential potential buyers have no basis to go to the courts to try to overturn denials.
Ironically there is one IRAC investigation that might eventually see the light of day : the controversial Brendel sale. It was requested by Minister Bloyce Thompson and he has said it can be made public. Twice the Irvings tried to buy a 2200 acre farm, and twice IRAC investigated and turned it down. In both cases the concept of “beneficial ownership” or who actually benefits from the farming operation regardless of which names are listed as shareholders justified the denials. The Irvings eventually resorted to a “global lease”. That requires yearly reports to IRAC on land leased out to accommodate this purchase and stay within the land limits.
The media has tried to get its hands on this investigation through Access to Information but the report sits on a shelf. The Irvings requested a third-party review of the Privacy Commissioner’s inquiry into whether the privacy rights of 2 Islanders not named Irving, but involved in the sale, would be harmed with its release.
This Brendel case is really the exception. As long as IRAC’s investigations and recommendations are treated like CSIS state secrets there will be an information vacuum people will fill with whatever makes sense to them. This is never a good thing.
Solutions? Use the Brendel case as a template on especially controversial land sales. If and when the Brendel report is released the public will see the effort IRAC made to unravel how Irving lawyers were trying to push the sale through. The Government needs to occasionally take the risk of further court action following a decision if it can provide more confidence that the LPA is working, and IRAC has the determination and tools to do its work.
There is a land affordability crisis on PEI right now. We need to make sure we’re finding the right reasons and blaming the right villains.
