01/27/2009

The Federal Government’s 2009 Budget included new and accelerated investment in municipal infrastructure, new funding for social housing construction and repairs, and an extension to Employment Insurance (EI) benefits.
Background:

The Budget includes additional funding for the Communities Component (municipalities less than 100,000 population) of the Building Canada Fund (BCF). The Federal Government will provide an additional $500 million over the next two years in new funding for the Communities Component – an estimated extra $195 million in federal funding in Ontario.

The government will also create a $500 million fund for recreational facilities like hockey arenas, swimming pools and community centres and provide $225-million over three years to extend broadband coverage to unserved communities.

The Federal Government will also make available up to $2 billion over two years in direct, low-cost loans to municipalities to finance improvements to “housing related infrastructure, such as sewers, water lines, and neighbourhood regeneration projects.” 

The government also committed to streamlining the federal approval process for infrastructure construction projects including changes to the Environmental Assessment Act, the Fisheries Act and the Navigable Waters Protection Act. 

A $4 billion Infrastructure Stimulus Fund will be created for provincial, territorial and municipal government infrastructure, including roads, clean water systems and public transit. The Budget indicates that provinces and territories will receive this funding on a per capita basis so Ontario should receive approximately $1.56 Billion over two years (39% of the total allocation).  

The federal funding will be project-based and require matching contributions from the province and from municipalities receiving funding. Premier McGuinty is reported to have signalled yesterday that the Government of Ontario intends to match new federal funding contained in the Federal Budget. AMO will stress with the Federal Government the importance of a streamlined application process to make it easier for municipalities to apply and to ensure that the funding is not delayed unnecessarily.

The infrastructure package also includes $2 billion for colleges and universities and a $1 billion Green Infrastructure Fund for sustainable energy infrastructure.

The Budget also contains $2 billion (nationally) in funding for social housing construction and repairs, including:  

• Providing a one-time federal investment of $1 billion over two years for renovations and energy retrofits for up to 200,000 social housing units on a 50–50 cost-shared basis with provinces.

• Investing $400 million over two years for the construction of social housing units for low-income seniors.

• Investing $75 million over two years for the construction of social housing units for persons with disabilities.

• Dedicating $400 million over two years to new social housing projects and to remediation of existing social housing stock on First Nations reserves.

• Supporting social housing in the North with an additional $200 million over two years.

(An equitable share of the new housing funding for Ontario should result in approximately $800 million over two years). 

The federal government is also providing funding of $60 million to support infrastructure-related costs for local and community cultural and heritage institutions such as local theatres, libraries and small museums.

All regions of the province will benefit from the following economic development announcements:

• Northern Ontario will receive $170 million over two years to secure a more sustainable and competitive forest sector; 

• Southern Ontario will receive $1 billion over five years for a Southern Ontario development agency to help workers, communities and businesses in this region; and  

• Eastern Ontario will be provided $20 million over two years for the Eastern Ontario Development program to support business and community development. 

Another important matter addressed in the Budget relates to the federal EI program. The Budget announces that benefits will be extended by five weeks over the next two years. This will relieve some pressure on Ontario Works expenditures by allowing laid off workers to rely on EI for a longer period of time. 

All of the Budget measures that will assist municipalities respond directly to AMO’s recent advocacy with the federal government.

Action:

AMO will pursue additional details and keep members informed of new developments.