Economic Action Plan 2013 proposes the Community Improvement Fund with funding of $32.2 billion over 10 years, consisting of an indexed Gas Tax Fund and the incremental GST Rebate for Municipalities to offer stable, predictable funding to support community infrastructure projects such as roads, public transit and recreational facilities.
Since 2006, the Government has provided increased infrastructure funding to municipalities. In Budget 2011, the Government committed to working with the provinces, territories and the Federation of Canadian Municipalities to develop a new long-term plan for infrastructure. In the consultations on the new plan, mayors from across the country and the Federation of Canadian Municipalities asked that federal funding for municipal projects be indexed and greater flexibility be afforded for municipalities to address their specific infrastructure needs.
The Government is responding to the requests from Canadas mayors and the Federation of Canadian Municipalities by introducing the Community Improvement Fund. The Community Improvement Fund provides funding for Canadian municipalities of $32.2 billion over the 10 years of the new Building Canada plan. Funding starts at approximately $2.9 billion in 2014-15 and increases to over $3.6 billion in 2023-24. The new Community Improvement Fund will afford municipalities greater flexibility to allocate federal support toward a broader range of infrastructure priorities.
The Community Improvement Fund includes:
- $21.8 billion over 10 years through Gas Tax Fund payments. Currently $2 billion per year, it is proposed that these payments be indexed at 2 per cent per year, starting in 2014-15, with increases to be applied in $100-million increments. The Government will conclude new Gas Tax Fund agreements before the end of current agreements on March 31, 2014. The list of existing eligible investment categories will be expanded to include: highways, local and regional airports, short-line rail, short-sea shipping, disaster mitigation, broadband and connectivity, brownfield redevelopment, culture, tourism, sport, and recreation.
- $10.4 billion over 10 years under the incremental GST Rebate for Municipalities to provide communities with additional resources to address their infrastructure priorities, from the construction of new infrastructure assets to the maintenance and operation of existing public infrastructure and facilities.