Canada's Economic Action Plan

Canada's Economic Action Plan

November 14, 2013 12:03 ET

Canada's Gas Tax Fund Helping the City of Toronto

Second installment of annual GTF transfer available for municipal infrastructure

TORONTO, ONTARIO--(Marketwired - Nov. 14, 2013) - The Honourable James Flaherty, Minister of Finance and Regional Minister for the Greater Toronto Area and Central Ontario, 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 Toronto's total allocation this year to close to $154.4 million; 100 per cent of its Gas Tax Fund allocation is directed to the Toronto Transit Commission's Ten-Year Capital Plan.

"Investments through the federal Gas Tax Fund are helping the City of Toronto address its transportation infrastructure priorities," said Minister Flaherty. "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 and the Government of Ontario, the Association of Municipalities of Ontario (AMO) and the City of Toronto administer the program across the province. 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 $1 billion has been made available to the City of Toronto under the current Gas Tax Fund.

The Gas Tax Fund has funded numerous initiatives across the City of Toronto that support public transit and active transportation.

"Since 2007, the federal government has invested and committed close to $1 billion into Toronto transit projects through the Gas Tax Fund, including the new Toronto Rocket Subway trains and diesel buses. I applaud the federal government's continued investment which will help fight the congestion issues plaguing Toronto and will keep us competitive," said Councillor Karen Stintz, Chair of the Toronto Transit Commission.

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 Ontario, please see the attached backgrounder and visit: www.infrastructure.gc.ca/pub/infra/gtf-fte/gtf-fte-2013-eng.html.

For additional information about federal investments in infrastructure visit www.infrastructure.gc.ca or follow us on Twitter at @INFC_eng.

For further information about Canada's Economic Action Plan, visit www.actionplan.gc.ca.

Backgrounder

THE GAS TAX FUND IN THE CITY OF TORONTO

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, the City of Toronto has benefited from over $1 billion in predictable and flexible funding for local priorities since the program began. The Government of Ontario, the Association of Municipalities of Ontario (AMO) and the City of Toronto administer the program across the province.

Results for the City of Toronto

The Gas Tax Fund is providing Torontonians with stable funding that will have a tangible impact on their quality of life and the long-term sustainability of their communities. In particular, the City of Toronto has committed 100 per cent of its Gas Tax Fund allocation to the Toronto Transit Commission's Ten-Year Capital Plan. As a result, the Gas Tax Fund has provided funding towards various transit projects, including:

  • Purchasing new subway cars to replace aging ones and increasing capacity by 9 per cent.
  • Acquiring new articulated buses and new forty-foot diesel buses.
  • Purchasing low-floor, accessible light rail vehicles to replace the existing streetcar fleet.
  • Continuing to install state-of-the-art signaling systems on the Yonge-University-Spadina line to increase train capacity by allowing trains to run more frequently and closer together.

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
    613-943-1848

    Andrew Bodrug
    416-392-4089
    abodrug@toronto.ca

    Infrastructure Canada
    613-960-9251
    Toll free: 1-877-250-7154