02/21/2005

Toronto, ON., February 21, 2005. AMO today raised concerns about the Provincial Government’s plan to replace Ontario’s existing $656 million Community Reinvestment Fund with a new model and provide $200 million in one-time funding to support transition to the new program.

The plan does not include provisions to pay outstanding bills related to the delivery of Provincial health and social service programs in 2004.
 
“This announcement does nothing to address the fact that municipal government subsidizes Ontario’s provincial programs,” said AMO President Roger Anderson.  “While the province plans to reconcile CRF funding for 2003, they are leaving municipalities on the hook for 2004.  Municipalities have closed their books on 2004 and now are left holding unpaid provincial bills.”

The CRF was established in 1998 under the previous government to provide partial mitigation for provincial downloading.  The CRF has provided annual payments to 403 municipalities with year-end reconciliations that better reflect the true cost of delivering provincial downloaded programs.  In 2003, this reconciliation was estimated to be more than $90 million. 

While the announcement included $200 million in one-time, transitional funding, questions remain about the long-term impact of a new funding model and the fundamental problems with current cost-sharing arrangements.  Removing provincial health and social service costs from the backs of Ontario’s municipalities and property taxpayers is the only fair, equitable and sustainable solution for Ontario communities. 

“Today’s announcement raises as many questions as it answers.  It is too early to determine if municipalities and property taxpayers are any better off under the new model.”  

The Association of Municipalities of Ontario (AMO) is a non-profit organization representing almost all of Ontario’s 445 municipal governments.  AMO supports and enhances strong and effective municipal government in Ontario and promotes the value of municipal government as a vital and essential component of Ontario and Canada’s political system.

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