Canada’s Gas Tax Fund Helping Newfoundland and Labrador Communities

The Honourable Rob Moore, Regional Minister for Newfoundland and Labrador and Minister of State (Atlantic Canada Opportunities Agency), announced today that the Government of Canada is making available the second installment of its annual $2 billion federal Gas Tax Fund allocation for municipal infrastructure, bringing Newfoundland and Labrador’s total allocation this year to close to $31.2 million.

“Investments through the federal Gas Tax Fund are helping Newfoundland and Labrador’s communities address their local infrastructure priorities,” said Minister Moore. “Our government is proud to support infrastructure projects that create jobs, promote productivity and support economic growth.”

Canada’s Gas Tax Fund provides predictable, long-term funding for Canadian municipalities to help them build and revitalize their local infrastructure while creating jobs and long-term prosperity. Funding is provided up front, twice a year to the Provincial Government which delivers this funding to communities across Newfoundland and Labrador. Projects are chosen locally and prioritized according to the infrastructure needs of each community. Municipalities can pool, bank and borrow against this funding, providing significant financial flexibility. To date, close to $206.9 million has been made available to Newfoundland and Labrador under the current Gas Tax Fund.

The Gas Tax Fund has funded numerous initiatives across Newfoundland and Labrador that support water and wastewater infrastructure, local roads, public transit, solid waste, community energy systems, active transportation and capacity building.

“I am pleased to see this announcement regarding our second installment of Gas Tax funding for 2013, which will enable a number of important projects in our municipalities,” said the Honourable Steve Kent, Minister of Municipal and Intergovernmental Affairs. “Gas Tax has also assisted in making significant progress on our Provincial Solid Waste Management Strategy. To date, the Provincial Government has committed $84.5 million to this effort, with $62.5 million coming from federal Gas Tax funding.”

The Government of Canada has extended, doubled, indexed and made permanent the Gas Tax Fund. These improvements will see Canada’s Gas Tax Fund grow from its current $2 billion per year while providing provinces and municipalities with predictable funding to deliver on local infrastructure priorities.

To read more about the Gax Tax Fund in Newfoundland and Labrador, please see the attached backgrounder.

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BACKGROUNDER
The Gax Tax Fund in Newfoundland and Labrador

The federal Gas Tax Fund makes capital investments in important community infrastructure. Eligible investments currently include water, wastewater and solid waste infrastructure, public transit, community energy systems, local roads and bridges, and capacity building. It provides predictable, stable funding, allowing municipalities to choose and plan the infrastructure priorities in their community.

Through the Gas Tax Fund, municipalities across Newfoundland and Labrador have benefited from close to $206.9 million in predictable and flexible funding for local priorities since the program began. The Government of Newfoundland and Labrador administers the program on behalf of its municipalities.

Results for Newfoundland and Labrador

The Gas Tax Fund is providing Newfoundlanders and Labradorians with stable funding that will have a tangible impact on their quality of life and the long-term sustainability of their communities. The Gas Tax Fund has provided funding towards various projects, including:

• Re-developing St. John's Robin Hood Bay Waste Management Facility into a modern, multi-purpose waste management centre that provides the region with an environmentally responsible way to recycle and divert waste.
• Creating a modern and environmentally-sound waste management facility, the Central Newfoundland Waste Management Facility in Norris Arm, along with seven other local waste management facilities throughout the region.
• Upgrading Church Road in the Town of Embree, improving safety and transportation efficiency for commuters and local residents.

How the Gas Tax Fund Works

Canada's Gas Tax Fund has provided $13 billion to Canadian communities to date. The funding allocation is based on population for most jurisdictions. In recognition of their population size, Prince Edward Island, Yukon, Northwest Territories and Nunavut receive amounts equal to 0.75 per cent of the total annual national allocation, allowing them to also make meaningful investments in infrastructure. Funding is provided up front, twice a year to provincial and territorial governments or to the municipal associations which deliver this funding within a province, as well as to the City of Toronto. Projects are chosen locally and prioritized according to the infrastructure needs of each community. Municipalities can pool, bank and borrow against this funding, providing significant financial flexibility.

On April 1, 2009, Gas Tax Fund payments doubled to $2 billion annually. In 2011, legislation was passed to make funding under the Gas Tax Fund permanent at $2 billion per year.

As announced in Economic Action Plan 2013, the eligible categories for the Gas Tax Fund will be expanded and the Fund will be indexed at 2 per cent a year in $100-million increments, starting in 2014, allowing municipalities even more flexibility to focus on their infrastructure priorities. The expanded categories include:

• Projects supporting culture, tourism, sport and recreation;
• Disaster mitigation;
• Broadband communication systems;
• Highways;
• Short-line rail;
• Short-sea shipping;
• Brownfield redevelopment; and,
• Local and regional airports.

Over the 10-year life of the New Building Canada Plan from 2014 to 2024, the Gas Tax Fund will provide close to $22 billion in funding for municipalities.

The Government of Canada is working with its provincial and territorial partners to ensure a seamless transition to the new funding.

2013 11 14             12:45 p.m.