September 03, 2008

Gift horse needs a close look

As published in The Erin Advocate

The premier was in fine form last week, speaking like a father figure to his needy and troublesome children, the municipalities of Ontario.

“We want build even more infrastructure. But our government can’t do it alone. We need a partner. That’s where you come in,” he said to officials gathered in Ottawa for the Association of Municipalities of Ontario annual conference. “True partners always treat each other fairly.”

Does Dalton McGuinty really have to lay it on so thick?

It was a case of wrapping bad news with good as he announced $1.1 billion in extra one-time funding for towns and cities to make whatever improvements they want to their roads, bridges, public transit, water pipes, community centres or social housing.

Chronic under funding, however, has left a provincial backlog of $50 billion in municipal infrastructure projects.

Still, a drop in the big bucket is better than nothing, and some say we should not look a gift horse in the mouth. (Gift horses are not the same as Trojan horses, though it is best to wary of both.)

Inspecting a horse’s teeth is a way to check its age and state of health. If you get a horse as a gift, and immediately look in its mouth, the giver may be offended. Looking a gift horse in the mouth is to appear ungrateful. Spending by the province, however, is not a gift. It is our own money finally coming back to us.

Wellington County will get an extra $3.3 million and the Town of Erin an extra $622,448. To put that in perspective, Town budget figures show capital improvements in the roads department at $766,500 in 2007, and $1.9 million in 2008.

I am sure something worthwhile will be done with the money. But one question will be: do we spend it on things we would likely have done anyhow, and lower property taxes, or spend it on extra projects and forego the tax benefit? Personally, I would go for the extra projects.

Often it is not a matter of building new infrastructure, but of fixing the old stuff before it crumbles away. The work is too expensive for towns to handle on their own, but they do not know from year to year how much help they will get from Queen’s Park.

This new flow of cash comes from a $1.7 billion budget surplus the province had last year. Surpluses are based on the government’s own estimates, and tend to make them look good, even though the money is spent a year later. The first $600 million is going (by law) to reduce the debt, and the rest to what McGuinty calls “a priority of our choosing”.

He didn’t call it a gift, but it was delivered with pomp and a superior tone. He made it clear that he could have decided to spend the $1.1 billion on health care or education instead. In the same speech, he also warned that since Ontario’s economy is not doing well, there would be no extra money next year. But the real bad news, especially at the county level, was his warning that plans to reverse the downloading of social service costs would proceed slowly.

“We won’t be able to move as quickly as we first thought we could when it comes to taking on new financial obligations,” he said.

Progress has been made as the province takes back some of the costs that Mike Harris dumped on municipal governments. But if they could take back much more, municipalities could make more progress on infrastructure.

Conservative MPP Ted Arnott has been rightly critical of the government for not providing stable funding for small towns from gas tax revenues.

Mind you, the Conservatives were not known for stable funding. And let us not forget one of the reasons Harris downloaded so many costs: the tag team of Jean Chr├ętien and Paul Martin had severely cut funding to the provinces to control the federal deficit in the mid-1990s. And why did we have a huge federal deficit? Could it have been all that borrowing and spending by Trudeau and Mulroney on things like infrastructure?

I don’t expect the province to spend wildly during an economic downturn. But I am offended when they treat the spending of my money on my community as a gift for which I should be grateful.

It is within their means to make infrastructure funding more stable and predictable, so that municipalities can do a better job of planning projects that are badly needed.

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