06/06/2006

Toronto, Ontario, June 6, 2006. Municipal leaders from across Ontario attended a breakfast meeting at Queen’s Park today where Premier McGuinty outlined Ontario’s case for addressing the federal/provincial fiscal imbalance.
The Premier briefed municipal officials on the key elements of Ontario’s strategy and garnered the full support of Ontario’s municipal leaders.

“People in Ontario’s communities are proud of their contribution to other parts of Canada,” said Roger Anderson, President of the Association of Municipalities of Ontario. “But they believe Ontario should be treated fairly by the federal government.”

In outlining Ontario’s position, the Premier said that equitable fiscal arrangements will help build strong communities, a stronger Ontario and a stronger Canada. 

Ontario’s position focuses on the “vertical fiscal imbalance” - calling for equitable treatment of all provinces and territories based on per capita federal transfers and a fair share of funding for programs such as infrastructure, training and EI.  It also calls on the federal government to refrain from increasing equalization, recognizing the current $11.5 billion equalization program (funded 43% by Ontario tax payers) is sufficient to fulfill its purpose of ensuring that people in all provinces and territories have access to comparable public services at comparable levels of taxation.  Ontario is also calling for a thorough, long-term review of fiscal arrangements through a National Public Commission that would include municipal governments. 

“AMO supports Ontario’s efforts to address the federal/provincial fiscal imbalance because it is the right thing to do and because it will ultimately be fairer to Ontario’s property tax payers,” said Anderson.  “Sorting out the fiscal architecture among all three orders of government is a priority for municipalities and property tax payers.” 

The federal/provincial fiscal imbalance in Ontario has a direct impact on municipal governments.  Ontario’s communities are contending with a provincial/municipal fiscal imbalance that costs municipal property tax payers more than $3 billion a year for provincial social and community health services.  Fixing the federal/provincial gap will allow the provincial government to end its reliance on property taxes to fund these provincial health and social services programs. 
 
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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