Canada's Economic Action Plan

Canada's Economic Action Plan

November 14, 2013 13:00 ET

Canada's Gas Tax Fund Helping Communities in the Northwest Territories

Second installment of annual GTF transfer available for municipal infrastructure

YELLOWKNIFE, NORTHWEST TERRITORIES--(Marketwired - Nov. 14, 2013) - The Honourable Leona Aglukkaq, Minister of the Environment, Minister of the Canadian Northern Economic Development Agency, Minister for the Arctic Council and Regional Minister for the North, 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 the Northwest Territories' total allocation this year to close to $15 million.

"Investments through the federal Gas Tax Fund are helping communities in the Northwest Territories address their local infrastructure priorities," said Minister Aglukkaq. "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 Government of the Northwest Territories which delivers this funding within the Northwest Territories. 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 $97.5 million has been made available to the Northwest Territories under the current Gas Tax Fund.

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

"Providing funding to community governments so they can address infrastructure needs directly benefits northern residents," said Robert C. McLeod, Minister of Municipal and Community Affairs for the Government of the Northwest Territories. "The Government of Canada's Gas Tax Fund allows us to provide more funding and more options to community governments, and in turn helps build sustainable, vibrant communities in the NWT."

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 Gas Tax Fund in the Northwest Territories, please see the attached backgrounder and visit:

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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 the Northwest Territories have benefited from close to $97.5 million in predictable and flexible funding for local priorities since the program began. The Government of the Northwest Territories administers the program on behalf of its municipalities.

Results for the Northwest Territories

The Gas Tax Fund is providing residents of the Northwest Territories 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:

  • The improvements of the local youth centre in the Hamlet of Paulatuk, which now functions more efficiently by capturing solar rays to feed electricity back to the power grid.
  • The rehabilitation and sustainability of the drainage and underground water and sewer infrastructure in Hay River.
  • The replacement of a pump house and the construction of a new water treatment plant in Yellowknife.

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 percent 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.

Contact Information

  • Marie-Josee Paquette, Press Secretary
    Office of the Minister of Infrastructure,
    Communities and Intergovernmental Affairs,
    and Minister of the Economic Development Agency of Canada
    for the Regions of Quebec

    David Maguire
    Communications/Web Advisor
    Municipal and Community Affairs
    Government of the Northwest Territories

    Infrastructure Canada
    Toll free: 1-877-250-7154