City on guard for downloading in PC budget

There's no end to the distractionswhen it comes to provincial announcements these days, froma new licence plate logotoliftingthe ban on tailgate parties.

But when the Progressive Conservatives table theirbudgetThursday their first since being sent to Queen's Park last Junemunicipal officials will be watching fora far less flashy issue: provincial transfers.

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It may sound like dry fiscal policy, but the money that Ontario sends to cities is critical for helping thempay for everything from roads to social housingto paramedics.

Ottawa counting on $650M in 2019

Last month, Ottawa city council approved a $3.6-billion budget for 2019, with more than $650 million expected to come from the province.

If those funds suddenly shrink a possibility given the province's cost-cutting and revenue-reducing mindsetthat's a big problem for the city.

"I hope the provincial government respects the fact that we have agreements on a wide range of cost-sharing programs, whether it's public healthor land ambulance," Mayor Jim Watson said earlier this week.

Watson hopes province won't 'download' in first-ever budget

5 years ago

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Ottawa Mayor Jim Watson says he hopes Thursday's provincial budget won't put municipalities in a tight spot.

He worries about the province "giving us another version of Highway 174," referring to the previous PC government of Mike Harris, which downloaded tens of millions of dollars in costs to the city in the 1990s including responsibility for the busy road that runs through Ottawa's east end.

Uncertainty around downloading

Indeed, it's the similarity between the Harris and Ford governments' rhetoric on slashing the deficit,which currently stands at$13.5 billion,that has some municipal watchers worried.

When those transfers are reduced, local governments have to either cut services, put off infrastructure improvements or increase local taxesall bad options, according to the Association of Municipalities of Ontario (AMO).

"I think people understand that the government was elected on the basis of reducing the deficit," said Pat Vanini, AMO's executive director.

"The concern is that in the past, when that's happened, the [municipal] property tax base has become a way to subsidize the province."

Pulled injection site funding

In fact, the province has already downloaded one service to the City of Ottawa: the operation of the supervised drug consumption services at Ottawa Public Health's clinic on Clarence Street.

The service had been funded by the previous Liberal government, butthe current government recently announced it will no longer pay for it, though it will continue to fund three other sites.

The city now needs to find $1.2 million a year to keep the Clarence Street site going.

"We recognize the province has financial challenges, but you don't really help the cause when you send it down to thelocal level where we have noone to download it to," Watson said.

Otherwise, "the province, so far, has been pretty good to us," Watson conceded.

In particular, the provincial government confirmed it would contribute$1.2 billion to the expansion of LRT.

Duringthe past six months of negotiations, "there was some doubt where we were going to get the full amount," according to theOttawa mayor.

But Premier Doug Ford came to Ottawa late last month to personally deliver the light-rail cash.

Making new homes cheaper

Althoughthe city isn't looking for a big-ticket item in Thursday's budget,Watson does worry about the budget details that aren't always apparent at first glance:"What the language means, and how it's going to impact us."

For example, there's been some suggestionthat the province may reduce development charges for new homes to help make housing more affordable.

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Development charges are added to home pricesto pay for additional infrastructure that comes along with new homeconstruction: think roads, sewers and water pipes.

But some cities, including Ottawa, also usedevelopment charges to fund other, softeramenities in new housing areas, like parks and libraries.

Ifthe charges are reduced, taxpayers would have to pick up the costs.

In AMO'spre-budget submission, it argued that "development charges are not a root cause of the affordable housing and supply challenge in Ontario," and only account for five to seven cent of the cost of a new home.

Small municipalities anxious

Smaller municipalities, including those in eastern Ontario, will be anxious about provincial funds specifically aimed at smaller communities.

The Ontario Community Infrastructure Fund, which helpssmall and rural communities, is supposed to reach $300 million by 2019.

Small municipalities will be watching to make sure that commitment is met in this year's budget.

They'll also be worried about the Ontario Municipal Partnership Fund, which assists 389 of the province's 444 municipalities with "more challenging fiscal circumstances."

The PC governmentdid eventually commit to the $505 million planned for this year, but the government has given notice that the program is under review.