Mayors press for infrastructure funds, green investment in countdown to federal budget

With city populations growing, infrastructure aging, and key funding programs running out of steam, cities are looking for support from general-purpose infrastructure funds and more targeted programs

When the mayors were in Ottawa last month to meet with federal decision-makers, their main focus was on infrastructure funds that are generally allocated with no green strings attached. Zeekakboos photo via Wikipedia.

This article was published by The Energy Mix on March 14, 2024.

By Mitchell Beer

As big city mayors enter the final countdown toward this year’s federal budget, they’re expressing deep concerns about long-term infrastructure funding—and some communities are also talking about the investments they’ll need to meet their energy-saving and emissions reduction targets.

When the mayors were in Ottawa last month to meet with federal decision-makers, their main focus was on infrastructure funds that are generally allocated with no green strings attached. But in interviews since, a couple of local councillors highlighted the essential role of federal and provincial governments in funding the public transit systems and efficient, resilient buildings that municipalities are trying to put in place.

At the end of February, 15 mayors associated with the Big City Mayors’ Caucus of the Federation of Canadian Municipalities (FCM) met with federal ministers in the nations’ capital to press their case for more funding, the Globe and Mail reported at the time. While long-term infrastructure funding was a central part of the Trudeau Liberals’ messaging when they took office in 2015, “several of those long-term programs are now beginning to expire and Canada’s cities are nervously waiting to find out what happens next,” the Globe said.

“We were promised infrastructure funding, and to this day, we have not heard of a plan,” FCM President Scott Pearce told media. “So as the budget comes closer and closer, we’re getting more and more concerned that there’s no plan.”

At an FCM meeting in May, Prime Minister Justin Trudeau promised an announcement in the fall that would “have very direct links to housing.” But local leaders “are expressing concern that the long-term plan won’t be in the budget either,” the news story stated, after an FCM analysis showed about a dozen federal funds like the C$2.4 billion-per-year Canada Community-Building Fund (CCBF) and the 11-year, $33-billion Investing in Canada Infrastructure Program (ICIP) due to sunset between 2024 and 2028.

Some programs that are technically still in place, like the $2.75-billion Disaster Mitigation and Adaptation Fund (DMAF), have spent their budgets and are no longer taking new applications.

Toronto Mayor Olivia Chow told the Globe she was optimistic about a boost in federal funding, but acknowledged a “grim” mood at the meetings two weeks ago. “Mayors are all united talking about fiscal crisis, under siege. Those are exact words,” she said.

“We need to update that [fiscal] framework. The existing tax system is obviously broken,” she added. “You can’t continue to rely on the poor property taxpayers.”

‘Baling Wire and Duct Tape’

Edmonton Councillor Keren Tang and Toronto Councillor Dianne Saxe, both board members at Climate Caucus, pointed to transit and buildings as the areas where climate-related infrastructure investment is most urgently needed. In December, 2022, Tang sponsored a motion calling for her city to work through the Big Cities’ Mayor Caucus to advocate for a $3.2-billion climate action fund to deliver federal funds directly to municipalities.

This week, she told The Energy Mix Edmonton is looking for project dollars to retrofit city properties and get more transit vehicles on the road. With 400 buildings in its portfolio, “the goal is to retrofit all of them, because we know how much of our corporate emissions come from buildings and this is what we can do” about it. But “it’s hard for us” without the funds to do the job.

The city is also trying to be better prepared for its more frequent role as a destination for wildfire evacuees from other parts of the province.

“The season has already started in Alberta,” she said. “We’re anticipating a very dry season, and we don’t feel we have the resilient infrastructure to meet those needs. So while these (federal) programs are great, it’s important to see some consolidated funding that amplifies this work, because the bottom line is that it’s not enough—our challenges are growing, and municipalities don’t have the tools and resources to meet that need.”

Municipalities do recognize that low-carbon design for new buildings and retrofits solves multiple problems at once, she added. “But the decision takes courage, really, and a lot of forethought. So I certainly hope it’s not going to be dead in the water or impossible, because that’s all of our goal.”

Saxe listed three transit projects as critical priorities for green infrastructure investment in Toronto: new subway cars for the Toronto Transit Commission (TTC), the city’s new East Waterfront light rail transit line, and hundreds of new electric buses.

The subway cars are needed for the TTC’s Line 2, the long route that runs along Bloor and Danforth from Kipling Ave. in the far east to Kennedy Ave in the far west of the city. The cars along Line 2 were built to last 60 years, they’re reaching the end of that road, and the purchasing needs to be planned ahead because “you can’t get them on Amazon,” Saxe noted.

The city and the Ontario government have committed funds for the procurement, but it can’t go ahead without dollars from all three orders of government.

“This is really, really, really essential, and if it isn’t in the budget, we’ll have a big problem,” said Saxe, an environmental lawyer who previously served as Ontario’s environment commissioner. “You keep assuming this stuff will keep working until one day it doesn’t,” and without new infrastructure funds, “we’ll be holding those old cars together with baling wire and duct tape.”

On the East Waterfront, Saxe said there’s still no transit plan in place after the three orders of government spent $1.5 billion getting the area ready for new development. “If that whole area is built around the car, we’ll have created another generational problem that will be very hard to recover from.”

Toronto also needs hundreds of new electric buses to meet its targets for transportation emissions under its TransformTO climate plan. “We have clarity in Toronto that transit is critical, and that lack of investment in transit is already harming the city,” Saxe said. “We need more bus frequency, we can’t do that without more buses, and in the financial stranglehold we’re in, we can’t do it without cash from the federal and provincial governments.”

Everything, Everywhere, All At Once

With city populations growing, infrastructure aging, and key funding programs running out of steam, Tang said cities are looking for support from general-purpose infrastructure funds as well as the more targeted programs earmarked for emission reductions and climate resilience. Cities want to see the CCBF and ICIP renewed, “but quite frankly, at the current level, it’s just not enough.”

Despite concerns about federal fiscal health, municipalities are hoping to see funding doubled from its current level, she said. “That’s the dream, right?”

While it isn’t yet clear whether any new or renewed funding programs will take on green investment criteria, if and when the dollars are announced, Tang said it would be a “significant shift from the original intent” for funding streams that were meant as a flexible tool for municipalities to meet local needs. Much of the talk leading into the April 16 budget announcement has focused on housing—but even there, adding energy or emissions criteria “could have unintended consequences,” she said.

Ottawa does have a separate tier of funds devoted to green infrastructure. “The challenge is that they’re oversubscribed, and they’re relatively small” compared to programs like the CCBF, Tang said. As things stand, “climate change is happening, a rate of growth is happening, and municipalities across the country will be hard pressed to achieve our goal with some of our energy transition priorities.”

With opinion polls pointing to a possible or likely change in government after the next federal election, expected to take place in 2025, some observers are beginning to quietly fret about possible funding reductions for municipalities, even though the Globe coverage pointed to dollars that were available to cities during the Stephen Harper years between 2006 and 2015.

“Oh, gosh, I hope not,” Tang responded, when asked whether today’s infrastructure programs might be at risk. As the councillor for the fastest-growing part of Edmonton, she said she hears from constituents daily about the need for new amenities, recreation centres, libraries and schools. “And I really don’t feel the property tax base is the right funding source to meet that demand of growth,” not to mention a $1-billion maintenance deficit for existing buildings and infrastructure.

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