Though cities welcome the billions of infrastructure dollars the federal government plans to deliver over the next 10 years through its New Building Canada Plan, uncertainty still surrounds transit maintenance and expansion projects thanks to the lack of enveloped funding for transit-specific projects and the ambiguity in some of the plan’s details, say stakeholders.
“Is it perfect? No, obviously not,” said Michael Roschlau, CEO of the Canadian Urban Transit Association (CUTA). “But I don’t know of any other country that has as long-term a federal commitment to infrastructure as this…so we’ve certainly come a long way.”
The federal government first announced its New Building Canada Plan in the 2013 budget, where it promised to dedicate roughly $47-billion in funding for infrastructure projects at the federal, municipal, provincial and territorial levels through various programs. Altogether, with the surplus of money that remained from its prior infrastructure fund, the federal government has dedicated about $53-billion for infrastructure projects of local, regional, or national significance over the next 10 years.
Three programs make up the plan for building infrastructure across the country in cooperation with other levels of government: there is the $32-billion Community Improvement Fund, the $14-billion Building Canada Fund, and the $1.25-billion P3 Canada Fund.
The Community Improvement Fund and Building Canada Fund are the two that will provide municipalities, provinces and territories with the biggest financial boosts to pursue transit development and maintenance. The former fund consists of $21.8-billion in gas tax transfers to provinces and territories and $10.4-billion in GST rebates to municipalities, while the latter consists of two subparts—one for any level of government and some non-state actors valued at $4-billion and the other for provinces and territories valued at $10-billion.
But many types of projects are eligible for funding, not just those that are transit-related, and the question as to how much funding transit projects alone will enjoy is unanswerable at this point in time. “It is up to each province, territory and municipality to prioritize projects that are important in their regions,” reads an email statement issued to The Hill Times by Infrastructure Canada.
Though the government heeded some of CUTA’s requests throughout the consultation process, said Mr. Roschlau, it failed to deliver the goods in this regard.
“We were looking for sufficient dollars and being able to have a portion of it that would be dedicated to transit,” he said. “As it turns out, the government wasn’t comfortable dedicating any of it to any particular sector.”
Neither the Building Canada Fund nor the gas tax transfers are attached to particular projects. In fact, the eligible funding categories under the gas tax transfer have been expanded and now include, but are not limited to, many of the sorts of projects eligible to receive funding under the Building Canada Fund — broadband and connectivity, public transit, highways, and disaster mitigation, just to name a few.
“It’s always tricky when you have different partners that need to collaborate, when you need the municipalities and the provinces to come together now to determine what the priorities are,” said Mr. Roschlau. “But I’m not too worried because I think that transit projects are still very much in the forefront in terms of their importance, especially in the larger cities across the country.”
According to data compiled by CUTA, the largest chunk of the gas tax transfer has historically been spent on transit-related projects. From 2007 to 2014, 39 per cent of the original gas tax fund was spent on public transit, with roads and bridges being the second-largest expenditure at 28 per cent and drinking water being the third-largest expenditure at 13 per cent. Water waste and solid waste were the fourth- and fifth-largest expenditures at 11 per cent and four per cent, respectively.
According to other data compiled by CUTA, capital investment from all levels of government in transit rose from over $500-million in 2001 to about $4.5-billion in 2012. Though in 2001 municipal governments were the largest source of funding, provincial and federal governments have since taken on larger roles. Since 2005, if not earlier, the federal and provincial governments together have been providing the majority of funding.
Still, Ottawa Mayor Jim Watson said city leaders were disappointed with the dollar amount the federal government plans to deliver through its Building Canada Fund.
“The challenge we have is that the $14-billion is significantly less than what a lot of municipalities were expecting,” said Mr. Watson. “Given the sheer magnitude of the costs of building these transit systems, there is going to have to be a greater contribution from all levels of government.”
As it happens now, Mr. Watson said all of Ottawa’s “gas tax money is going into the city’s light rail project.” Banking on getting $600-million from the federal government through its Building Canada Fund and $600-million from the provincial government, Ottawa’s light-rail expansion will require $2.1-billion in investment.
The first project to be funded by the Building Canada Fund was a transit project in Edmonton, an emailed statement from Infrastructure Canada said.
“Through the Provincial-Territorial Infrastructure Component of the New Building Canada Fund we have set aside up to $150 million for the Valley Line, with up to $250 million already committed from P3 Canada.”
Mr. Roschlau said this is reassuring and that he and everybody at CUTA “are really pleased that first major project to be announced is a transit project.”
Mr. Roschlau said next steps include ensuring that the Building Canada Plan is leveraged in the optimal way. Mayor Watson also said there is still a lot of work to be done with other big city leaders.
“My hope is that mayors from across the country will work collaboratively to get the message out that we need all hands on deck when it comes to funding these massive transit projects,” he said. “Unlike a lot of European cities, we’re very far behind in terms of the number of people taking transit versus taking their car.”
Big city leaders and other big players in the municipal movement met up this weekend at the Federation of Canadian Municipalities’ 2014 Annual Conference and Trade Show to learn from experts, connect with each other, and influence decisions made on the federal level that affect municipalities. Urban transit was on the agenda.
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