07/24/2008

Ontario and Canada announced the signing of the $6.2 billion Canada-Ontario Infrastructure Framework Agreement. It is the first step in the process for federal-provincial municipal infrastructure funding under the Building Canada Fund.
Background:

In the 2007 federal budget, the Government of Canada announced the creation of the Building Canada Plan, a seven-year, $33 billion national initiative to invest in core infrastructure priorities. To allow funding to flow, the federal and provincial/territorial governments must sign agreements that set out governance processes and priorities. Canada and Ontario have been negotiating the Framework Agreement and in March 2008, AMO called on the province and federal government to sign the agreement to allow the funding to flow. Today the governments announced that the agreement is signed and funding to the province and municipalities is set to begin.

The Building Canada Plan includes a suite of infrastructure funding programs flowing over seven years. In Ontario, this includes:

  • The GST Rebate – Estimated at $2.09 -$2.5 billion based on 5 or 6 per cent
  • The Gas Tax Fund - $2.9 billion in Ontario (extension 2010-2014)
  • Equal Per Jurisdiction Fund - $175 million in Ontario
  • Gateways and Borders - $2.1 billion nationally – Ontario TBD
  • P3 Fund - $1.25 billion nationally – Ontario TBD
  • The Building Canada Fund - $3.09 billion in Ontario
The Building Canada Fund is split into two components: the Major Infrastructure Component and the Communities Component. The Major Infrastructure Component will provide $2.73 billion to large-scale projects. The Communities Component provides $362 million for investments in communities with populations less than 100,000. All funding will be matched by the province and municipalities on a 1/3 basis, bringing total infrastructure contributions to approximately $9.3 billion over seven years.

The Framework Agreement also creates an Infrastructure Framework Committee to approve projects under the Major Infrastructure Component. Projects for the Communities Component are expected to be decided through a competitive process. A federal-provincial sub-agreement is required for Communities Component funding to flow.

The governments also confirmed today that Ontario municipalities are able to access funding under the $2.1 billion Gateways and Borders and $1.25 billion Public-Private Partnerships funds.

Action: For your information.