2012 Perspectives Magazine - Manitoba Heavy Construction ...

The IFC: Bringing
Attention to the Issues
“69% of Canadians Regard Local Infrastructure
as the most important priority for continued
spending as the deficit is dealt with.”
The Infrastructure Funding Coucil Report reveals ways of
how to fix the infrastructure problem in Manitoba.
“You and I come by road or rail, but economists travel
on infrastructure.” - Margaret Thatcher
Municipal governments across Canada face a $123
billion deficit on existing infrastructure. Most Canadian
cities have to make tough decisions to choose between investing
in public safety (and other city services) or maintaining their
infrastructure. While infrastructure deficits are a growing
problem, municipalities, by law, have to balance their budgets
each year. The growing infrastructure problem is pushed off from
the budget documents onto the crumbling roads, rusting bridges
and aging community centres in the form of limited investments
in urgent infrastructure needs to build vibrant communities.
The Federation of Canadian Municipalities (FCM) and the Big
Cities Mayors Caucus have urged the Government of Canada to
work with municipalities to address their infrastructure needs.
In 2010, the FCM estimated that 69% of Canadians regard local
infrastructure as the most important priority for continued
spending as the deficit is dealt with, second only to health care.
According to The Economist, Canadian municipalities ”lack both
money and powers” to address growing infrastructure needs.
This leading international publication highlighted once again
that municipalities in Canada “get only eight cents out of every
tax dollar”, with the majority of municipal revenue coming from
property taxes.
In 2010, The City of Winnipeg and the Association of Manitoba
Municipalities formed the Infrastructure Funding Council
(IFC), chaired by the President of the Manitoba Heavy
Construction Association, Christopher Lorenc, to develop series
of recommendations that will tackle infrastructure deficit in
Manitoba municipalities. It is estimated that in Winnipeg, the
total deficit is $7.4 billion, which consists of $3.8 billion of existing
and $3.6 billion of projected infrastructure needs.
In the spring of 2011, the IFC submitted a comprehensive report,
titled ”New Relationships: A New Order. A balanced approach to
funding municipal infrastructure in Manitoba”. The IFC report
outlined an overall infrastructure funding strategy. It also provided
internal and external infrastructure funding options within the
control of the municipalities and the recommendations that
require intergovernmental negotiation and approval.
The IFC Chair stated that the
report identified various revenue
sources that could ”generate more
than $1 billion in annual funding”.
The report shows that provincial
and national governments have
to play greater roles in providing
dedicated revenue needed to fund
infrastructure deficit in Manitoba.
The IFC has provided a menu of
options that can tackle the deficit.
Seventeen IFC recommendations
are separated into three groups
- recommendations that can be
acted by municipalities on their sam katz
own, recommendations that
require provincial approval and
recommendations require provincial
and federal governments’ participation.
The three recommendations that the City of Winnipeg is seeking
immediate action on are:
1. From the Province of Manitoba – a dedicated infrastructure
funding (for all Association of Manitoba Municipalities members)
equal to 1% of existing PST (over and above 2011 provincial budget
allocation);
2. From the Province of Manitoba - the Rebate of PST paid by
municipalities to the provincial government;
3. From the Government of Canada - Permanent (and indexed)
transfers to municipalities of the federal Gas Tax Fund.
These three revenue streams combined will bring hundreds of
millions of dollars in addition funding for the infrastructure needs.
So far, the City of Winnipeg has received no response from other
levels of government to this request.
The City administration is currently reviewing all the internal and
external revenue options that elected officials in Winnipeg can
use to fund the infrastructure deficit in the future. The Canada
14 perspectives Magazine