This comment has been submitted jointly by Alberta Association of Municipal Districts and Counties president Donald W. Johnson, Association of Manitoba Municipalities president Ron Bell and Saskatchewan Association of Rural Municipalities president Neal Hardy.
Batter up.
It’s time for the federal government to step up to the plate and alleviate the financial challenges faced by small communities across Canada and its first priority should be to erase the prairie municipal infrastructure deficit once and for all.
The limited fiscal capacity of smaller municipalities is giving way to stark realities. They’re forced to play in the big leagues without big league budgets, meaning they often bunt for bite-sized projects instead of swinging for the fences on more pressing issues.
Read Also
Agriculture needs to prepare for government spending cuts
As government makes necessary cuts to spending, what can be reduced or restructured in the budgets for agriculture?
And therein lies much of the problem. These pressing issues don’t confine themselves to infrastructure. Governments across the Prairies are facing significant pressures to deal with a multitude of challenges.
For example, the effects of the BSE disaster that crippled Western Canada to the tune of billions of dollars are still being felt today, even though the borders are finally open. Weak international commodity prices, coupled with serious drought conditions in many prairie regions, are straining even the most robust farming operations.
And who would have dreamed that diesel prices would reach and even surpass the price of refined fuel?
Now let’s add infrastructure pressures into the mix. Municipal governments have the primary responsibility for maintaining a wide range of public infrastructure, including water and sewage treatment plants, municipal roads, waste management facilities, recreational centres and public buildings. They must also develop and maintain the infrastructure that supports emergency response such as police, fire protection and ambulance services.
Once municipalities reach the point where they are unable to address their infrastructure responsibilities, an infrastructure deficit occurs.
The Canada West Foundation more specifically defines the deficit as a shortfall in funding required to construct new infrastructure as well as maintaining, rehabilitating and replacing existing capital assets to ensure proper functioning and satisfactory service levels.
Reports ballpark the combined infrastructure deficit in Manitoba, Saskatchewan and Alberta at just over $20 billion, representing a third of the nation’s total.
While it is difficult to quantify the deficit, there is broad consensus that the deficit exists. It’s substantial, it threatens quality of life and it continues to grow while limiting the potential of local, regional, provincial and national economies.
Infrastructure is aging; most of it is at nearly 80 percent of its service life. There is no denying that a large spike in infrastructure spending needs to take place soon.
But given that local governments have limited ability to raise revenue, reduced infrastructure service levels are inevitable, and that affects quality of life.
The question becomes: how are smaller municipalities able to keep up the breakneck pace of maintaining and building needed infrastructure?
The answer is fearfully simple. There is no community anywhere in the Prairies that can do it alone.
That’s one of the reasons why the federal government sent a home run hitter to the plate in 2005 with the New Deal for Cities and Communities.
The initiative is based on the transfer of $5 billion over five years, increasing to $2 billion in the fifth year.
Although stable and predictable, the excitement of the New Deal ribbon-cutting announcement has long passed. Taking a broader view of the challenges, it’s easy to see that the agreement is a Band-Aid solution to a gaping wound.
Assuming current federal commitments to infrastructure are maintained along with incremental provincial and municipal investment, the municipal infrastructure deficit will simply not be eliminated within this generation.
No one will argue that the New Deal is not a much-needed revenue source for Canadian municipalities. But also, no one should argue that this investment will ease the call for increased infrastructure spending. Municipalities need long-term funding that enables them to develop and manage critical and sustainable infrastructure.
But that doesn’t mean that the entire infrastructure burden should be transferred solely to the broad shoulders of federal and provincial governments.
After all, municipal governments are in the best position to determine the needs and priorities of their communities and must be equal partners in multilateral initiatives to enhance infrastructure.
In this spirit, funding agreements that comprise federal, provincial and municipal investments are good steps, but the level of funding is inadequate. Small communities often do not have the resources to match funding from federal and provincial governments, making the need for a substantial and permanent funding program more critical than ever.
There is also an urgent need for program permanency. The start-and-stop nature of ad hoc infrastructure programs does not allow for proper planning and management of municipal infrastructure.
We need predictable, reliable and stable sources of revenue to plan and fund long-term investment in infrastructure. This concept is echoed by the Federation of Canadian Municipalities as it continues to lobby the federal government to end the infrastructure deficit within 20 years.
There’s a lot riding on our communities’ ability to maintain and build sustainable infrastructure. It’s time to move to the next phase and up to the big leagues.
We need to ensure the sustainability of our communities.
We need to see them prosper and their citizens thrive.
We need the provincial and federal government to take the lead in erasing the municipal infrastructure deficit by contributing to long-term and predictable spending commitments.
We need more than a home run.
We need to win the game.
