Fraser Institute News Release: Precedents Exist for Reversing the Forced Amalgamation of Canadian Municipalities

TORONTO, ONTARIO--(Marketwired - July 7, 2015) - Municipalities forced to amalgamate by their provincial governments can reverse the process, given the right set of circumstances, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

"Nearly every province in Canada has gone through some form of municipal restructuring over the past three decades," said Lydia Miljan, Fraser Institute senior fellow and co-author of De-Amalgamation in Canada: Breaking Up is Hard to Do.

"In Ontario, it happened in the late 1990s in the form of provincially mandated amalgamations. The controversial merging of cities, both big and small, hasn't resulted in the cost savings and efficiencies that its architects predicted, leaving some to ask to question: is de-amalgamation a viable option?"

The study examines two very different cases of de-amalgamation - in Headingley, Manitoba and in Montreal, Quebec - to evaluate the fiscal and governance implications of reversing a municipal consolidation.

Headingley, a rural community in southern Manitoba, was forcibly amalgamated with the City of Winnipeg in 1972. For decades, community residents demanded that they be allowed to secede, arguing that they didn't have much in common with the larger, more urban sections of the city. Finally, in 1993 the provincial government relented and legislated Headingley's secession.

Despite some difficult separation negotiations, Headingley has now become a financially healthy community.

"The case of Headingley should provide some hope for de-amalgamation advocates in the rural parts of Ontario where the provincial government forced the merger of rural communities with large urban centres. If Headingley can secede based on its relatively few connections to the urban centre, then conceivably so can communities like Flamborough in Hamilton or Osgoode in Ottawa," Miljan said.

Headingley's relatively smooth transition, the study notes, was aided by two key factors: Its population base was able to absorb the cost of services transferred to it and its de-amalgamation didn't necessitate the creation of new and complex governing structures.

Conversely, the de-amalgamation experience in Montreal may persuade some Torontonians - those who want to revert to the old governance model - to take pause.

In 2004, a new provincial government in Quebec facilitated referenda offering municipalities the opportunity to reverse the amalgamation forced upon them in 2002. In Montreal, many municipalities opted to stay but some did leave forcing the creation of yet another level of local government to coordinate local services (ie: property assessments, social housing, transit and public safety) for all communities (amalgamated and de-amalgamated) on the Island of Montreal.

"The key lesson from Montreal's experience with de-amalgamation is that allowing certain areas to de-amalgamate and others to stay can create a costly, cumbersome and fragmented patchwork of government across the region thus complicating service delivery," Miljan said.

"If de-amalgamation were to be pursued in Toronto, then policy makers would be best advised to avoid the Montreal model."

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org.