HALIFAX - A new online report shows three Nova Scotia municipalities have failed a test that could result in an automatic review of their financial viability.
The Municipal Affairs Department says the index released Tuesday indicates Westville, Clark's Harbour and Mulgrave are not meeting enough benchmarks to be considered financially viable.
Under a grading system that ranks performance in 15 categories including revenue, budget deficits and capital assets, the towns received red warnings in six or more over a three-year period.
Municipal Affairs Minister Mark Furey said he is working with municipalities to finalize the review process, which was recommended in a fiscal report released last fall.
Kentville Mayor Dave Corkum said the data in the online report is a valuable indicator, but he cautioned that a lack of red warnings under the criteria doesn't mean towns are on a solid financial footing.
Corkum said as many as 10 face significant financial challenges.
"I think this is a calling card for all of us ... to sit up and take notice and maybe improve situations," he said.
Furey agreed, noting that Hantsport, which has applied for dissolution, would not have been subject to an automatic review under the grading system.
He said in the Hantsport case, local leaders recognized there were long-term trends that cast doubt on whether the town could remain financially viable.
"I'm not sure that we need three years of data," said Furey who added department officials would be discussing various alternatives for faster action as part of the review process.
The online report contains three fiscal years of data for all but two of the province's 54 municipalities.
Department officials said the town of Parrsboro and the Municipality of Pictou failed to get their financial information returns for 2014 in on time.
Although specific reasons for the lapses weren't given, Furey said his department is working to get the data.
In the case of Parrsboro, Furey said his deputy minister had been in discussions with town officials over the last week.