Column: Many municipal leaders at this week's conference said they welcome both new immigrants and more housing but want to know how they're supposed to pay for the infrastructure and amenities to accommodate both.
Canada’s minister of housing and infrastructure says the country needs to “revisit how communities receive funding at our municipal level.”
Sean Fraser made the comment Wednesday to a crowd of hundreds of B.C.’s municipal politicians and officials. Many members of the audience had spent much of this week similarly arguing that B.C.’s municipalities need a reworked and more reliable funding stream from Ottawa to support the infrastructure and services needed to accommodate expected population growth.
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So while some of them might be glad to hear Fraser talk about the need for “a new framework to fund municipal growth,” his comments didn’t suggest change would come any time soon.
Fraser addressed an audience who came from around B.C. to gather in a downtown Vancouver convention centre. His remarks came near the end of a two-day housing summit convened by the Union of B.C. Municipalities.
The conference comes at a time when Canada’s federal government has set immigration targets putting Canada on-pace for record population growth — with most of those newcomers coming to urban centres like Metro Vancouver — and the B.C. government’s sweeping housing reforms are forcing cities to densify and boost housing production.
A common theme throughout this week’s UBCM summit was that many municipal leaders say they welcome both new immigrants and more housing — but they want to know how they’re supposed to pay for the sewage pipes, transit infrastructure and basic amenities to accommodate both.
Penticton Mayor Julius Bloomfield asked Fraser whether the federal government was willing to consider a more “steady income stream to municipalities to cover infrastructure costs,” rather than forcing them to rely on “intermittent grants, which make it difficult to do long-term planning.”
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In response, Fraser said he is “open to very new kinds of ideas” around how the federal government funds municipalities’ infrastructure needs, but the government hasn’t “come to decisions necessarily on what they may look like.”
Municipalities are “increasingly looking for that long-term certainty and a new framework to fund municipal growth,” Fraser said. “I’m starting to ask myself more and more questions around: ‘How can we provide that certainty, while we still assure ourselves that the federal government is going to see the return on investment that we want to see with sustained investments in municipal infrastructure?
“I think we need to revisit how communities receive funding at our municipal level in this country,” Fraser said, adding that the answer will come from “bringing the three levels of government together to understand what is the long-term vision for your community.”
Fraser was speaking about the need to get different levels of government together to a room full of people who had spent the past two days talking about their desire to see the same thing.
Fraser was hosted onstage by UBCM president and Coquitlam Coun. Trish Mandewo, who at one point quoted an old maxim: “As you know, we like to say: ‘The federal government has all the money, the provincial government has all the power and local government has all the problems.'”
Mandewo’s comment embodies a long-standing complaint from Canadian municipalities, which have limited tools for generating revenue, as most are restricted from collecting income and sales taxes and are therefore heavily dependent on property taxes and fees, such as those levies on new development.
The Federation of Canadian Municipalities has estimated that local governments are responsible for 60 per cent of Canada’s infrastructure, but receive around 10 cents of every tax dollar collected.
Last year, Metro was considering hiking the fees levied on new residential development to go toward $11.5 billion in infrastructure needs — including sewage and water facilities, and parks — to accommodate the region’s expected population growth.
With unusually large fee increases being considered — as high as 255 per cent — Fraser wrote a letter to Metro’s mayors, management and board members, urging them to think twice.
“Significant increases to development charges have the potential to deter development,” Fraser wrote, which he warned could impede housing construction at a time when “we all know that we need to build more homes, and that we need to do so faster.”
Fraser encouraged Metro to delay the fee increases. It was an unusual move, for a federal cabinet minister to weigh in on a regional government decision. Some members of Metro’s board of directors, which is made up of the region’s locally elected mayors and councillors, were unhappy about the minister’s approach. In a split vote, they rebuffed his request.
At the UBCM conference Wednesday, Fraser addressed a packed room that included many of the same Metro politicians who bristled months earlier at what they saw as his intrusion in their affairs.
“It’s through engagement with organizations such as this right across the country that I think we can come to an agreement on what the long-term plans for a different funding model should be for municipalities, that’s a more consistent, predictable source of revenue beyond what they can squeeze out of property taxes,” Fraser said.
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