INDEPTH: MUNICIPALITIES
Chase the bouncing Loonie: Cities vie for a new deal
Justin Thompson, CBC News Online | Updated February 3, 2004
In the Liberal government's speech from the throne in February 2004, Prime Minister Paul Martin promised Canada's cities a full rebate on the GST they pay, giving them a $500-million "down payment" on the money they say they need to shore up their crumbling infrastructure.
Martin said the GST rebate would give cities $7 billion over the next decade. The speech also promised the cities a share of the federal gas tax.
Many of the mayors of Canada's cities were pleased with the announcement of the GST rebate, but federal NDP Leader Jack Layton called it "Speech Writers' Rhetoric 101."
Promises laid out in the throne speech are not binding as a budget would be and Layton said, in the past, "the delivery doesn't seem to follow."
It's only been recently that higher levels of government have paid attention to the cities' appeals for a "new deal."
Looking for a new deal
A common refrain among Canadian municipalities – particularly the larger ones – has been a call for a "new deal" with the federal government. They complain that too many programs have been downloaded onto them by the provincial and federal governments while not enough tax money has been given back.
Things like some social programs, public health programs and airports have been made municipal responsibilities. Local property taxes can't rise fast enough to keep up and municipalities are constitutionally unable to impose sales taxes.
Add to this the fact that 80 per cent of all Canadians live in cities, and you have a recipe for dissent.
The Federation of Canadian Municipalities says all that adds up to a serious shortfall. The group – a national body for municipal issues – says there is a $60-billion gap between the cost of programs municipalities must deliver, and what they can afford.
The solution, according to the group, is a new deal.
What's the old deal?
To understand the "new deal," it's important to know what exactly the "old deal" is, and if there was even an old deal to begin with.
"Yes and no," says Nelson Wiseman, an associate professor of political science at the University of Toronto.
"Cities are creatures of the provinces," he told CBC News Online. "Municipal government exists as a result of the province, meaning cities and municipalities go to the province for (most of their) funding."
Municipal-federal contact – while it varies from province to province and city to city – comes mainly as part of a tripartite agreement with the provinces, says Wiseman. These agreements are common when funding arrangements are being made for infrastructure programs, for example, that are too large for one level of government to handle alone.
The B.C. government and federal government have pledged $310 million apiece to pay for new facilities for the 2010 Olympic Winter Games.
|
|
One example of this is Vancouver-Whistler's recent bid for the 2010 Olympic Winter Games. The federal government and B.C. provincial government each agreed to contribute more than $9 million toward preparing the bid, and a further $310 million apiece in infrastructure money to build the Olympic facilities.
In this case the tripartite arrangement worked, and Vancouver-Whistler got its funding. But this is an example of a large, high-profile project. Municipalities say smaller projects are just as important, but funding agreements are often mired in too much red tape.
Lobbying for change
At the forefront of the push toward change are the mayors of Canada's largest municipalities.
In Winnipeg, Mayor Glen Murray – who Toronto Star columnist Christopher Hume once called "arguably the most respected municipal leader in Canada" – has been one of the most dogged campaigners for a new deal. He wants municipalities to have a cut of the federal gasoline tax and a cut of provincial sales tax revenue. And if Ottawa felt extra generous, he reasons, it could let the cities divvy up one per cent of the GST, something that could net $100 million a year for the city of Winnipeg alone.
Toronto mayor David Miller after his election win on November 10.
|
|
Murray has been vocal in supporting similar overtures by former Toronto mayor Mel Lastman and his successor David Miller. Miller turned the new deal into a big campaign issue in his successful run for mayor, and he has vowed to lead the movement – already underway – to get more money flowing into the cities. It's an ambitious goal considering the sums involved – Miller says his city needs $300 million a year for transit alone.
This job may be made easier, given the newly evolved political climate that sees city-friendly leaders elected to federal and provincial levels.
Prime Minister Paul Martin has said on many occasions that he will work toward a new deal with cities. He has said temporary infrastructure programs for building roads and sewers could be made more permanent and that he would consider handing over a portion of the gas tax – something he opposed in the past.
Martin has also batted around the idea of consulting mayors the way he consults premiers before passing a budget.
The Federation of Canadian Municipalities would like to see him take it a step further. At a conference on Nov. 7, 2003, mayors belonging to the group called on Martin to designate a federal minister responsible for working with municipalities.
While he made no promises at the time, Martin offered a nugget of hope at a convention of B.C. municipalities in September 2003.
"Our goal has to be to make municipal funding more predictable and reliable, and yours to control," he said.
The mayors of Vancouver, Edmonton, Calgary, Regina, Winnipeg, Toronto, Ottawa, Montreal, Quebec City and Halifax then met in Toronto in January 2004 to discuss transit, housing and taxes ahead of the throne speech.
After the throne speech, Toronto Mayor David Miller welcomed the GST rebate. His city stands to save $52 million a year.
"I think the prime minister understands cities, and I think he's a man of his word," Miller said after the speech.
^TOP
|
|
 |
 MENU |
|
|
| MEDIA: |
|
|
| QUICK FACTS: |
List of big city mayors, from the Federation of Canadian Municipalities:
Vancouver: Larry Campbell
Surrey: Doug W. McCallum
Calgary: David Bronconnier
Edmonton: Bill Smith
Regina: Pat Fiacco
Saskatoon: Don Atchison
Winnipeg: Sam Katz
Brampton: Susan Fennell
Hamilton: Larry Dilanni
Kitchener: Carl Zehr
London: Anne Marie DeCicco
Mississauga: Hazel McCallion
Ottawa: Bob Chiarelli
Windsor: Eddie Francis
Toronto: David Miller
Gatineau: Yves Ducharme
Montréal: Gérald Tremblay
Laval: Gilles Vaillancourt
Québec: Jean-Paul L'Allier
Longueil: Jacques Olivier
Halifax: Peter J. Kelly
St. John's: Andy Wells
|
|
| CBC STORIES: |
|
|
| EXTERNAL LINKS: |
|
|
| MORE: |
|
|
|
Watch Brian Stewart's documentary "Cities: The Last Colonies"
CBC does not endorse and is not responsible for the content of external sites. Links will open in new window.
