07/10/2014

Frequently Asked Questions (FAQs) about various terms and conditions of the Municipal Funding Agreement.


What happens to funds carried over at the end of 2013?

Unspent funds as of December 31, 2013 are automatically rolled into the new Agreement and they can be used towards the new eligible project categories. Funds can also be saved for another five years. If so, investing funds in the One Investment Program can make Gas Tax funds grow so you have more for later. Learn more at www.amo.on.ca/Invest.

What is the Asset Management requirement? Do we have to create a new document?

Municipalities are required to complete an Asset Management Plan by December 31, 2016. The agreement requires plans to include the information and analysis as described in the Province’s guide. Specifically Part 3 of the guide (pages 29-40 in the print version) outlines the elements required which include an executive summary, introduction, state of local infrastructure, expected levels of service, an asset management strategy and a financing strategy. This is the same as the plan that is required by the Province of Ontario in order to access provincial funding.

Through the Gas Tax Fund, municipalities also have to demonstrate that projects are being prioritized based on Asset Management practices.

What is incrementality and how is this measured/demonstrated?

Federal Gas Tax funds must increase the amount of investment in municipal infrastructure. In other words, federal funding cannot displace a municipality’s own investments or offset or reduce municipal tax rates.

Incrementality is measured by comparing average annual investments over the life of the Gas Tax Agreement (2014-2023) with average annual investments between 2000 and 2004 (the base amount). In general, the formula is total capital expenditures, minus development charges, minus capital grants.

AMO will be reporting on this in aggregate using FIR data. In order to do so, each municipality is required to match its level of investments to its own base amount. AMO will be displaying each municipality's base amount in the online reporting system and calculations are provided below for your reference.

Since the Gas Tax Agreement is 10 years in length, municipal investments can rise and fall from year to year and still meet incrementality.

To calculate the Base Amount, 2000 to 2004

Capital Expenditures – 52 9910 7
Less Development Charges Collected – 60 0699 1
Less Capital Grants (federal & provincial) – 50 0499 1

To monitor over the life of the Agreement, 2014 onward

Additions & Betterments – 51 9910 03
Plus Construction-in-Progress (Expenditures) – 51C 9910 02
Less Construction-in-Progress (Capitalized) – 51C 9910 03
Less Development Charges Collected – 60 0699 01
Less Federal Capital Grants - 53 0425 01
Less Provincial Capital Grants - 53 0430 01
Less Canada gas tax - 53 0440 01
Less Provincial gas tax - 53 0445 01

Our municipality did not spend any of the Federal Gas Tax money this year, do we need to complete online reporting?

Completing the Online Annual Reporting Module is required every year even when there are no expenditures.