Creating a New Municipality

How is a new municipality created?

A new municipality can be created when:

  • An area, or areas, not covered by a municipality (unincorporated) is established as a municipality.
  • An existing municipality moves from one class to another class. 

A proposal to establish a new municipality needs to be filed with the Island Regulatory and Appeals Commission (IRAC).

A proposal to establish a new municipality can be started by:

  • The Minister responsible for the Municipal Government Act 
  • The council of a municipality
  • A group of at least 30% of people (specifically, electors who are or would be within the proposed municipality) whose name are on a petition. 

Download the proposal form for establishing a new municipality.

What must a proposal to establish a municipality include?

A proposal to establish a new municipality must include:

  •  A statement that the proposal is to establish a new municipality
  • The reason for the proposal
  • The names of the adjoining municipalities and unincorporated areas and other affected areas.
  • Estimated population and total property assessment, a map with boundaries, the class of municipality (city, town or rural municipality), the name of the proposed municipality, services that will be provided, and existing or proposed assets.  
  • The name of the representative of the petitioning electors when the proposal is submitted by a group of people. 

What are the classes of municipalities?

The following classes of municipalities can be created:

  • City
  • Town 
  • Rural Municipality

What is the criteria for establishing a city or town?

The criteria for establishing a new city is:

  • Estimated population of 15,000 or greater
  • Estimated total property assessment value of $750,000,000 or greater

The criteria for establishing a new town is:

  • Estimated population of 4,000 – 14,999
  • Estimated total property assessment value of $200,000,000 - $749,999,999

What happens if the proposed municipality does not meet the criteria?

The Minister can refer the proposal to IRAC if it is in the Minister’s opinion that it is in the public interest to establish the municipality. 

Are there requirements for the petition to establish a new municipality?

Yes – the MGA outlines what needs to be included in the petition that goes along with the proposal to establish a new municipality.  Subsection 15(6) and (7) of the MGA sets out the requirements for a petition. 

How will I know if there is a proposal to establish a municipality happening near me?

IRAC must publish a notice in a local newspaper in the area where the new municipality is being proposed.  There also must be a notice in at least 3 visible places in the area that is going to be affected (such as a community hall or a rink). 

IRAC can also use additional methods, such as electronic means, to publish the notice.  The notice will have a map of the area proposed to be included in the municipality. The notice must include information about how a person can file an objection to the proposal. 

IRAC must notify adjoining municipalities, and municipalities and First Nations Bands that may be affected by the establishment of the new municipality.  The Federation of PEI Municipalities (FPEIM) must also be notified. 

How can I voice my opinions about a proposal?

You will have an opportunity to share your opinions about a proposal to establish a municipality.  You must fill in a form and submit it to IRAC within 30 days of the date that the notice was in the newspaper or was posted. 

IRAC may choose to hold a public hearing if there are objections.  IRAC will hold a public hearing if the Minister determines that there is significant public interest.  

If a municipality has an objection to the proposal, IRAC will appoint a mediator to assist the municipalities in resolving the dispute.  If the dispute remains unsolved (and the objection is not withdrawn), IRAC will hold a public meeting.

How is the decision made to establish a municipality?

Once any mediations or public meetings are complete, IRAC will provide the Minister with a written report containing its finding, recommendations and reasons for the recommendations.  This report will be sent to the council, nearby municipalities, nearby First Nations Bands, FPEIM, and any other persons that IRAC believes should receive it.

The Minister will review the report from IRAC and will make a recommendation to the Lieutenant Governor in Council.  The Lieutenant Governor in Council may then decide to:

  • Establish the new municipality as proposed or with changes, or
  • Deny the establishment of the new municipality as proposed

See an overview of the Municipal Restructuring Process.

Note: This page is prepared for information purposes only and should not be relied upon as a substitute for specialized legal or professional advice.
Published date: 
February 15, 2018
Communities, Land and Environment department logo

General Inquiries

Municipal Affairs and Provincial Planning
2nd Floor, Aubin-Arsenault Building
3 Brighton Road
PO Box 2000
Charlottetown, PE   C1A 7N8

Phone: (902) 620-3558
Fax: (902) 569-7545