Prime Minister Justin Trudeau has announced the federal government will be offering municipalities an advanced transfer of infrastructure funding to help cover COVID-19-prompted budget shortfalls.
Trudeau says the government will be making $2.2 billion available for municipalities through the Gas Tax Fund. The PM said municipalities normally receive these payments in two installments each year, but because of COVID-19 the full 2020/2021 payment will be delivered in one payment in June.
Trudeau says communities have the flexibility to use the funding to meet their local needs and the money can be used for providing residents with access to high-speed broadband, improvements to water and road systems, and the building of cycling and walking paths.
“From coast to coast to coast, Canadians are feeling the economic impacts of COVID-19, while they do what they can to protect the health and safety of their families and communities,” said Prime Minister Trudeau in a statement.
“That is why we are taking action to restart the economy, get Canadians back to work, and come out of this stronger. This funding will help communities address their immediate needs, while also planning the infrastructure they need for the future.”
During his daily COVID media briefing outside of Rideau Cottage, Trudeau said today’s announcement to assist Canadian municipalities is just “the first step” and that the Liberals are currently looking at other ways of supporting the work municipalities are doing across the country.
Trudeau said the federal government will be working with the provinces, which have jurisdiction over municipalities, to provide more emergency aid.
I’m giving an update on the work we’re doing with the provinces and territories – and small towns and big cities across the country – as we look at restarting our economies. Watch live for more info: https://t.co/KxXAFBhTBM
— Justin Trudeau (@JustinTrudeau) June 1, 2020
Municipalities have seen steep losses in revenues as a result of the pandemic as fewer people are paying for transit or parking, amongst other city-funded programs.
Toronto alone has been losing approximately $65 million per week through losses in TTC revenue, other closures, decreased service demands, and property tax and utility payment deferrals. Today’s announcement will not be nearly enough funding to help the City recover.
Trudeau’s announcement amounts to giving munis their 2020-201 federal gas tax allotment in one lump sum, instead of two instalments. Toronto budgeted $167 million from federal gas tax in 2020. “This is just a start,” says Trudeau. Better be, because that’s not going to do much.
— Matt Elliott (@GraphicMatt) June 1, 2020
Toronto city councillor Joe Cressy, Ward 10 Spadina-Fort York, said the government’s announcement to accelerate existing support won’t help Toronto, which is already facing a $1.5 billion shortfall this year due to COVID-19.
“If cities fail, the country fails,” said Cressy.
Toronto is facing a $1.5 billion shortfall this year alone due to COVID-19. A strong & robust recovery will require significant new Federal investment. Today’s announcement that the Feds will accelerate existing support for cities doesn’t help. If cities fail, the country fails.
— Joe Cressy (@joe_cressy) June 1, 2020
Trudeau did say this was a first step, but it’s pretty clear a giant leap is going to be needed next in order to get Toronto back in track.