July 21, 2010

Saskatchewan may get stimulus deadline relief

OTTAWA

The federal government has opened the door a crack to flexibility in its stimulus funding deadline. Ottawa, from the prime minister on down, has insisted over and over that March 31 is the firmest of firm cutoff dates for the massive federal stimulus program.

But flooding in Saskatchewan has the federal government pondering an exemption to the contentious March 2011 deadline to finish stimulus projects. Provincial officials brought the question up with Ottawa a few weeks ago, and Ottawa is now taking a second look.

“At the moment, the deadline is the deadline. But we’ll have to look at that issue,’’ a senior official at Infrastructure Canada said in an interview.

Heavy rains in the prairie province earlier this summer closed several highways, prompted evacuations and disrupted the peak construction season — at the very time when builders across the country are working full tilt to keep the $16-billion federal stimulus program on schedule.

But while an extension of the deadline under such circumstances may seem logical at first glance, it could set off a chain reaction that would put the federal government in a difficult position.

That’s because there’s a long lineup of municipalities and contractors that believe they also deserve an extension.

And there’s another lineup of players who say any extension would be unfair because they deliberately held back certain projects in the knowledge that they would not make the deadline.

Most of the stimulus projects are funded by the federal government, in conjunction with provinces and municipalities.

But the federal funding dries up on March 31, 2011, because Ottawa wants the work to be done quickly to create jobs and help economic recovery, but also so it can reduce the deficit later on.

If work drags on after March 31, the municipalities will have to carry 100 per cent of the costs, unless they have negotiated a deal with their contractors to pick up the bill.

That cutoff has prompted concern — and desperate measures — in many corners of the country.

Quebec municipalities say their projects are months behind because of bureaucratic delays stemming from the municipal elections last fall, and wrangling between different levels of government.

Contractors in Ontario talk about twiddling their thumbs while waiting for approvals, and then having to work around the clock to meet internal deadlines.

“There are far too many projects being called for tender that have quick fixes instead of long-term solutions,’’ one contractor told the Ontario Road Builders Association in a recent questionnaire.

He complained that roads in need of repair were not being put to tender because of time constraints. Instead, roads that were not in terrible shape were getting the stimulus funding.

Canadian Press

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