Infrastructure minister Brian Mason told a meeting of his provincial and territorial counterparts that Alberta right now needs some “flexibility” in how it can match federal money, because of the current state of the province’s revenue.
Mason said he wants to help towns and cities as much as possible but there are limits with the provincial economy still deep in the red.“It’s difficult for us in present circumstances to further increase our contribution towards municipal infrastructure,” Brian Mason said Wednesday. “We’re already contributing more.”
Edmonton’s mayor said there’s a solution to the problem. Alberta doesn’t have the money on hand, however Mayor Don Iveson said what they could do to help build LRT is create — like Ontario has —- a holding company that owns the rail assets and can borrow the money now to get construction going.
“Say it’s a $5 billion package of infrastructure,” Iveson, who’s lead of FCM’s Big City Mayors’ caucus told reporters during a break in the meeting of provincial and territorial ministers. “They can allocate $500-million a year for 25 years to pay it down, which is much easier for a province to do than come up with $5 billion on the front end.”
Iveson said the feds and provinces can afford to spend the money up front because almost immediately they start to get it back through increased revenue. Cities can only rely on increased property taxes to get a larger share, while only receiving as little as eight cents on the dollar.
“Based on the principles that the senior orders of government have much greater fiscal capacity than us, receive a return off the infrastructure investments that they make in the form of income and sales and business taxes and that we have to look after it for the next 50 years. Any agreement that respects those principles would be very very positive.”
The federal and provincial ministers are meeting at the Shaw Conference Centre in Edmonton to discuss the next phase of Ottawa’s plan to invest $120 billion on infrastructure.
Prime Minister Justin Trudeau’s government has promised to cover half the costs of the new projects, rather than the expected one-third.
That has led to public sniping between Mason and Iveson over Alberta’s decision to contribute 25 per cent.
In the case of a recent City Hall report, the difference between one-quarter and one-third from the province meant City Council had to approve an additional $23 million to cover project costs.
Iveson told reporters that it’s anticipated federal minister Amarjeet Sohi will have the makings of a deal on a much more lucrative phase two of the infrastructure program by the end of 2016.
(sj with files from the Canadian Press)