August 2016
Backgrounder

Municipal governments own more of Ontario’s infrastructure than any other order of government. Most of it is essential to our economic prosperity and our quality of life, including:
  • Drinking water
  • Sewage and waste disposal
  • Parks and recreational facilities
  • Social housing
  • Local roads and bridges
  • Public transit 
This infrastructure is under mounting pressure. Much of it was first built in the 1950s and 1960s and needs modern upgrades or replacement. A growing population is also increasing the burden on existing infrastructure and fueling the demand for new investments. It was estimated in 2008 that Ontario faces a municipal infrastructure gap of $60 billion that will take 10 years to close, leaving municipalities with a bill of $6 billion each year.

AMO has advocated for dedicated, long-term, sustainable infrastructure funding programs from the federal and provincial governments. The 2008 agreement to upload provincial social services and some court security costs to the Province helps municipalities to free up property tax dollars for infrastructure investment. Ontario’s municipalities have also put recent federal and provincial funding programs to good use with projects that are improving infrastructure across the province.

Municipalities also appreciate the ongoing New Building Canada Fund and the increased Ontario Community Infrastructure Fund. The federal government has also committed new housing funding, as well as a new immediate stimulus program for the Public Transit Infrastructure Fund and the Clean Water and Wastewater Fund. Municipal governments across Ontario are looking forward to a new federal-Ontario agreement and what it means for our municipal governments. Other provinces and territories have signed agreements. Continued implementation of municipal asset management planning will also help councils prepare long term infrastructure financing plans and to make good investment decisions for their residents. 

Federal Government
  • In 2016, the federal government announced $3.4 billion for the Public Transit Infrastructure Fund (PTIF) and $2.0 billion for the Clean Water and Wastewater Fund (CWWF) nationally.
  • In Ontario, these funds will be $1.5 billion for PTIF and $570 million for CWWF. The federal government will supply up to 50 per cent of project funding, requiring allocations from provincial and municipal governments. Municipal governments in Ontario are waiting for news and details on how program design and how to access these funds. 
  • In 2007, the Building Canada Plan provided $33 billion for infrastructure over seven years. The 2015 New Building Canada Plan (NBCP) builds on these long-term infrastructure investments, with an additional $53 billion for provincial, territorial and municipal infrastructure over 10 years. This includes: 
    • Community Improvement Fund: consists of the federal Gas Tax Fund and incremental Goods and Services Tax Rebate for municipalities, providing over $32 billion to municipalities for infrastructure projects.
    • New Building Canada Fund: a $14-billion fund that encourages infrastructure projects of national, regional and local significance to promote economic growth, job creation and productivity. 
      • $4 billion goes towards the National Infrastructure Component (NIC), and $10 billion is allocated for the Provincial-Territorial Infrastructure Component (PTIC).
      • Each province and territory will receive a base amount of $250 million, plus a per capita allocation over the 10 years of the program.
    • Public-Private Partnerships Canada Fund: an additional $1.25 billion in funding administered by PPP Canada.
  • The federal government’s Small Communities Fund (SCF), part of the PTIC within the New Building Canada Fund, provides Ontario with $272 million for projects in municipalities with populations less than 100,000. Ontario has agreed to match this funding amount. 
  • The federal Gas Tax Fund (GTF) has been renewed as part of the New Building Canada Plan. Legislated to be permanent in December 2011, the renewed GTF will provide $775 million annually to Ontario municipalities from 2014 to 2019.
  • The Community Infrastructure Improvement Fund provided nearly $150 million for community infrastructure upgrades and repairs. FedDev Ontario invested in 430 infrastructure projects through the Fund starting in 2012. All funding for this program has been committed. 
  • The New Public Transit Fund (PTF) is a fund in the 2015 Federal budget to help finance significant transit projects and upgrades to roads, bridges, and mass transit lines. The PTF includes $750 million over two years, to start in 2017-2018, followed by $1 billion a year with a combination of public and private investment.
  • The federal government has also committed to an additional $60 billion over ten years to support transit, green and social infrastructure.
Ontario Government
  • The Infrastructure for Jobs and Prosperity Act, passed by the legislature in spring 2015, makes asset management planning mandatory for broader public sector organizations such as municipal governments.
  • Regulations specifying the form and content of these plans are in the consultation phase, however given Ontario municipal governments have asset management plans, AMO doesn’t believe it is a policy priority for these plans to be re-done – funding is the priority
  • Budget 2015: Building Ontario Up includes a record investment of $130 billion in public infrastructure over 10 years.
  • The Ontario Community Infrastructure Fund (OCIF) was increased in 2016 with funding under OCIF formula support growing to $200 million and application funding to $100 million annually by 2018-19. 
  • Budget 2015 also includes an increase by $2.6 billion in dedicated funds for Moving Ontario Forward, for a total of $31.5 billion over 10 years, which includes: 
    • $16 billion for transit projects in the Greater Toronto & Hamilton Area (GTHA).
    • $15 billion for transportation and priority infrastructure projects outside the GTHA.
  • $15 million annually will go to the new Connecting Links program to help pay for the construction and repair costs of municipal roads that connect communities to provincial highways. 
  • Since 2008, several funding programs have provided more than $1 billion for various municipal infrastructure initiatives. 
  • The permanent Gas Tax for Transit program also provides ongoing support for municipal transit systems. This program transferred $321.5 million in much needed funding to 96 municipal transit systems in 2014.
Recent funding from the Ontario government has helped to begin the process of asset management planning in many communities to ensure that municipal councils identify needed capital investments to best use funds. AMO and its subsidiary, Local Authority Services (LAS), are working to build capacity for asset management at the local level. AMO will continue to work in partnership with the Governments of Canada and Ontario to ensure that programs address the needs of communities across Ontario.