Provincial leaders reject infrastructure solution
By Chad Ingram
Published Aug. 24, 2017
During last week’s Association of Municipalities of Ontario (AMO) conference, the leaders of Ontario’s main political parties rejected the idea of raising the HST by one per cent to assist with municipal infrastructure funding.
There is an estimated infrastructure gap – a shortfall of money needed to repair infrastructure that has come to the end of its lifespan – of approximately $5 billion a year in Ontario.
“We were asked a year ago by the Premier to come up with some creative solutions for the infrastructure gap, which is just under $5 billion, so this doesn’t make its way all onto land-based taxes,” said Minden Hills Reeve and Haliburton County Warden Brent Devolin.
As a result, AMO was advocating a jump in HST from 13 to 14 per cent, that extra percentage point – the equivalent of about $2.5 billion a year – to be earmarked specifically for municipal infrastructure.
“A resounding ‘no’ from the government,” Devolin said. “The Premier said she had only become aware of it in recent days. Hmm . . . “
“It isn’t new,” said Algonquin Highlands Mayor Carol Moffatt, who was also at last week’s conference. “The AMO has been working on this proposal for well over a year.”
Of Premier Kathleen Wynne’s assertion that she’d only learned of the proposal in the days leading up to the conference, “I find that surprising,” Moffatt said.
Not only was the concept rejected by Wynne, but NDP leader Andrea Horwath and Progressive Conservative leader Patrick Brown also denounced the idea.
“It was disappointing to hear all three leaders say they didn’t support it,” Moffatt said.
She added that outside of property taxes, municipalities have few revenue-generating tools to rely upon.
“People will continue to see property tax increases,” she said. “We don’t really have any other options.”
Devolin said another suggestion from the Eastern Ontario Wardens’ Caucus was that a higher percentage of provincial gas tax money be levied toward municipal infrastructure projects.
That, too, was shot down.
“Certainly, the rejection of the gas tax and the one per cent, and some of the other initiatives we had, basically, the underlying message to us, both as the general conference and the wardens’ caucus, the policies and the philosophies they have, they are sticking to and they’re not varying from that,” Devolin said. “They’re just on the path they’re on.”
More than half of all public infrastructure in Ontario is owned by municipalities, while municipal governments collect nine per cent of all taxes.