But Blaine Higgs and Tim Houston say they're not accepting that Ottawa will only pay for half the project and will still go to court to argue it should cover the entire cost, now estimated at $650 million.

The two Progressive Conservative premiers have been in a war of words with the federal Liberal government for more than a year over whose responsibility it is to reinforce the road, rail and telecommunications infrastructure linking New Brunswick and Nova Scotia.

The federal government offered to fund up to half the project, and until Tuesday it wasn't clear if the two provinces would even apply for funding on that basis.

Federal Infrastructure Minister Dominic LeBlanc, left, and Higgs at the growth meeting Tuesday of federal and provincial politicians from the region. LeBlanc wouldn’t commit to funding half of the new $650 million cost estimate for the Chignecto Isthmus project. (Isabelle Arseneau/Radio-Canada)

"Yes, we will be applying for it to meet the deadlines that have been put forward," Higgs said at a news conference. 

"At the same time we will be seeking clarification and a legal interpretation of the Constitution." 

Houston said his government will file a reference case with the Nova Scotia Court of Appeal to argue that Ottawa is obligated to pay the full cost of the project. 

He said other provinces will likely intervene in that case. Reference rulings are non-binding.

Ottawa has 'dug in': Houston

"This is a nationally significant trade corridor," Houston said. "I don't believe there's disagreement on the significance of it, but I think there's a little bit of difference of opinion on who should pay. I believe it should be a priority of the federal government." 

The two premiers spoke following an Atlantic Growth Strategy meeting of federal and provincial politicians from the region.

The deadline for the two provinces to file their applications to the federal Disaster Mitigation and Adaptation Fund is 4 p.m. AT Wednesday.

"The federal government has dug in," Houston said. "They said 'No [to paying the full cost], apply under the program for half.' So we'll do that."

The Chignecto Isthmus is a key transportation corridor that connects Nova Scotia to New Brunswick. The premiers for both provinces have been in a war of words with the federal Liberal government for more than a year over whose responsibility it is to reinforce the road, rail and telecommunications infrastructure. (CBC News)

An estimated $35 billion in trade each year crosses the isthmus, which is protected from the Bay of Fundy tides by dikes and an aboiteau built centuries ago.

A 2018 report found that 70 per cent of the dikes in Nova Scotia are vulnerable to a one-in-50-years storm. Sea levels in the province are projected to increase by as much as a metre by 2100.

The Trans-Canada Highway, the main Canadian National rail line and fibre optic cables all cross the isthmus not far from the water's edge. 

Isthmus upgrade 'a priority project,' LeBlanc says

Federal Infrastructure Minister Dominic LeBlanc wouldn't commit to funding half of the new $650 million cost estimate, saying the question was hypothetical because the application hasn't been filed yet.

"We will evaluate the project that they will submit," he said.

He said Ottawa will probably receive applications for billions more than what's in the disaster fund's budget, but he called the isthmus upgrade "a priority project."

 Nicole O’Byrne, a University of New Brunswick law professor, says the Nova Scotia and New Brunswick premiers are on solid ground arguing the Chignecto Isthmus project is within federal jurisdiction because the infrastructure links two provinces and, by extension, the country. (Mag Hood/Submitted by Nicole O'Byrne)

Houston complained Tuesday that the provinces shouldn't be forced to apply under the disaster fund.

He said the project is so large that it'll crowd out other worthy mitigation and adaptation projects in Nova Scotia.

"All the other projects would be more suited, better suited, properly suited for that program — they don't have a chance to get approved," he said.

Upgrade estimate now $650 million

A report released in March 2022 presented three options, with the most expensive — raising the existing dikes and installing reinforcing steel sheet pile walls in some locations — estimated at $300 million.

Earlier this year the estimate was increased to $400 million. Ottawa agreed to contribute $200 million, or half the total, under a federal disaster mitigation program.

But now the Higgs government is putting the total figure at $650 million.

 Memramcook-Tantramar Green MLA Megan Mitton, whose riding includes the New Brunswick part of the isthmus, says work could have started by now if not for the federal-provincial feuding. (Jacques Poitras/CBC News)

Spokesperson Bruce Macfarlane said the new figure comes from a joint analysis by the two provinces along with a private engineering firm. He said the $650 million figure includes a contingency for cost overruns.

University of New Brunswick law professor Nicole O'Byrne says the two premiers are on solid ground arguing the project is within federal jurisdiction because the infrastructure links two provinces and, by extension, the country.

"The courts would likely find that is sufficient evidence to place the Chignecto Isthmus project under the jurisdictional authority of the federal government," she said.

But she said that doesn't necessarily mean Ottawa would be forced to pay the entire cost.

"Courts generally do not rule on the funding formula that should be used to fund cost-sharing projects," she said.

"This is not a legal determination. It is a political expression of co-operation by provincial and federal governments in the public interest."

Feud 'wasting the precious time,' says N.B. MLA

Memramcook-Tantramar Green MLA Megan Mitton, whose riding includes the New Brunswick part of the isthmus, says work could have started by now if not for the federal-provincial feuding.

"It has become something where they are trying to score political points, and it's really frustrating," she said. 

Mitton said the town of Sackville and other low-lying areas around the isthmus are one extreme storm away from disastrous flooding. 

"We're really facing a major risk and I'm terrified that this bickering is going to waste the time that we need.... They're wasting the precious time that we need to protect my community."