August 21, 2006
Speed up funding
Canadian Construction Association tells feds
The Road and Infrastructure Program of Canada (TRIP/Canada) has urged the federal government to expedite its timeframes for ramping up sorely needed funding for municipal and transportation infrastructure.
In a pre-budget submission to the Commons standing committee on finance, the special committee of the Canadian Construction Association said the government should be commended for the investments it has made in the past two budgets in this sphere.
Gas tax-sharing agreements announced in the 2005 budget will pump $5 billion into municipal infrastructure over a five-year period.
The 2006 budget provided for creation of a Highway and Border Infrastructure Fund (HBIF), which will allocate $2.4 billion. An additional $2.2 billion in new money was committed for the Municipal Rural Infrastructure Fund (MRIF).
TRIP/Canada said the HBIF in particular “was a program that was long overdue and one which will pay significant dividends” in the years to come.
However, shorter timeframes need to be implemented, said the federation of 10 provincial roadbuilding and heavy construction associations and the Ontario Sewer and Watermain Construction Association.
“In almost all cases, funding ramps up over a five-year timeframe,” TRIP/Canada executive director Jeff Morrison told Daily Commercial News. “What we’re saying is that five years is too long. We want to see that (timeframe) shortened.”
The committee submitted its eight-page brief Thursday.
It warned that the relatively long timeframes to ramp up funding to significant levels means municipal and highway infrastructure will continue to decay in the intervening period, “which results in higher repair and/or replacement costs.”
Given strong federal revenues and the increasing need for municipal infrastructure and highway investment, TRIP/Canada recommended that transfers under the gas tax program be ramped up to its full $2 billion per year by at least 2008/09, a year ahead of schedule “and remain at that level indefinitely.”
In the case of the HBIF, the committee proposed that the $725 million a year level should be achieved by 2008/09, rather than by the forecast 2010/11, and that the government continue increasing that amount over the subsequent two years to reach a level of at least $1 billion per year.
For the MRIF, TRIP/Canada said funding should be ramped up to approximately $650 million by 2008/09. A minimal amount of $750 million should be established over the subsequent two years. Funding should never fall below $725 million.
“In years one and two, funding under these programs is pretty small,” Morrison said. “It is only by about year five that you start seeing the really impressive annual funding amounts.”
In its brief, the committee also called on the federal government to commit to long-term, predictable infrastructure funding and to ensure that infrastructure programs be given annual allocations.
“We’d like to see an element of predictability added,” Morrison said.
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