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FCM Urges Federal Investment in Critical Infrastructure

FCM President and Mayor of Gore, Quebec Scott Pearce (FCM Photo)

In response to pressing challenges facing Canadian communities, including housing shortages, affordability issues, homelessness, and climate change, the Federation of Canadian Municipalities (FCM) has issued an urgent call for increased federal investment in critical infrastructure.

This plea comes as municipalities across the country grapple with historic crises, urging the federal government to take immediate action.

"We have been moving at a record pace," stated Mike Savage, Mayor of Halifax at a press conference after the Big City Mayors' Caucus (BCMC) met in Ottawa this week. "Municipalities nationwide are accelerating housing construction, expediting permit approvals, and implementing innovative zoning solutions to expedite housing development."

Despite municipalities' dedicated efforts to bolster housing, they shoulder the responsibility for owning and maintaining the infrastructure upon which Canadians rely daily, yet receive only a fraction—between 8 and 12 cents—of each tax dollar.

"We tend to take infrastructure for granted because most of us only think about it when it's not working," remarked FCM President Scott Pearce in the same press conference "However, critical infrastructure and services come at a cost, and municipalities cannot continue to rely solely on property tax increases to fund them."

Decades of underfunding and outdated municipal funding models have left municipalities struggling to keep pace with record growth. Pearce emphasized that funding mechanisms have remained largely unchanged since 1867, a time when transportation primarily involved horse and buggy, and population growth was measured in the hundreds rather than millions.

FCM is urging the federal government to take decisive action in Budget 2024 by enhancing its commitment to new housing and investing in the infrastructure necessary to foster complete communities for Canadian families. This includes advocating for programs like the Canada Community Building Fund (CCBF) to support the growth and rehabilitation of existing municipal assets.

"It is high time to empower municipalities with the tools they need to support growth," Savage emphasized. FCM is calling for a collaborative effort among all levels of government to develop and agree upon a Municipal Growth Framework to ensure economic development and a high quality of life in every community across the country.

Pearce Calls On Federal Leaders To Do More

Speaking candidly to reporters on Monday, Pearce emphasized that Canadian mayors serve as community builders rather than gatekeepers, shedding light on the complex dynamics surrounding housing development amidst economic challenges. "Mayor's dont build houses, developers build houses." the FCM President said that due to high interest rates its hard for builders to build in this economic challenging time. "With full respect to Mr. Poilievre the problem that Municipalities are facing - it's $107,000 for infrastructure funding per infrasturue unit, and the average homeowner pays $5,000 - $7,000 in property taxes."

He cited a FCM-commissioned research, revealing that the average cost of municipal infrastructure required to support each new housing unit stands at a staggering $107,000. "Without Infrastructure funding to help municipalities with the growth (Municipalities) are loosing revenues. We cannot put this burden onto our residents and our taxpayers," Pearce underscored the necessity for federal cooperation and support.

Pearce expressed concern over the potential ramifications if the federal government fails to engage with municipalities in addressing the housing crisis. He warned that without adequate infrastructure funding, municipalities would be forced to shoulder unsustainable financial burdens, inevitably passing them onto residents through increased taxes. The urgency of the situation was emphasized by data from the Canada Mortgage and Housing Corporation (CMHC), projecting a shortfall of 3.5 million housing units needed to restore affordability to 2004 levels by 2030.

Emphasizing the bipartisan nature of the issue, Pearce stressed that regardless of political affiliations, infrastructure funding remains paramount to achieving the ambitious target of constructing 5.8 million housing units by 2030. "Whether it's Mr. Pollievre, Mr. Trudeau, or whoever the government is - the infrastructure funding is the most important thing if we are going to be successful in building the 5.8-million housing units by 2030," Pearce added. Savage agreed with Pearce, that FCM and Municipalities from across Canada are willing to work with any party, "Whether it's the Liberal Party, the Conservative Party, the New Democrats, the Bloc or the Green Party - we can find some common ground."

Pearce cautioned against a one-size-fits-all approach, recognizing the diverse needs of municipalities across the country. Pearce highlighted the unique challenges faced by smaller rural communities, "If you tie funding to housing, what are the small rural municipalities going to do. They don't grow as fast as some of the large cities do."


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