Transport Committee on June 10th, 2010

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Vaillancourt, you're absolutely right. Partnership…

[Gilles Vaillancourt]

Thank you for acknowledging that.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

You have political experience which is very much to your credit, and I have a great deal of respect for you. However, I learn something new every day in Ottawa.

You said earlier that you have not had an opportunity to hold office at the federal or provincial level, but I, fortunately, have had that opportunity and I have also worked at the municipal level. I can tell you that the development and economic stimulus plan that Ottawa is rolling out now is extremely rigourous. What the government really wants to do now is put the economy back on track, and that seems to be well underway. Some 300,000 jobs have been created in the last year and a half, and that is continuing.

[Gilles Vaillancourt]

Mr. Généreux, I commend the government for what it has done and, with every budget, I have had an opportunity to express the Coalition's satisfaction with respect to the maintenance of infrastructure programs. I am not against the government. I am not here to criticize the government. I am simply here to say that, when it comes to your most critical partners on the ground—which is what the municipalities are—this strict deadline will mean that they are forced to participate at a level which would not have been feasible for them.

All I'm asking is that you show some consideration and compassion for the poor municipalities, even as you continue to be rigourous.

[The Chair, Conservative, Merv Tweed]

Mr. Kennedy.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

Thank you, Mr. Chairman.

Welcome, Your Worship. Your perspective is a breath of fresh air. It is absolutely critical. This committee is the only one which has the responsibility to review the infrastructure program. The federal government has increased its own spending, but not necessarily its prospects of success. It is very important for there to be some practicality and common sense at the local level.

I would like to ask some specific questions about potential solutions. What timeframe would be needed by the municipalities to complete these projects, in a way that would be effective for both the country and the federal government?

[Gilles Vaillancourt]

In terms of the timeframe, it is difficult to express that in terms of dates because some municipalities may need six months. For example, there are cases where a second coat of asphalt could only be laid the following spring when asphalting plants are operating again across the country. Others may need a little more time because the work they are completing now is more complex. I am thinking, for example, of a number of projects involving cultural centres, libraries, etc.

In fact, the appropriate standard should be that those projects which are underway and have advanced to a certain stage should be recognized and subsidized.

If you were to announce today that all projects submitted between now and the end of the month will qualify and be subsidized right up until the work is completed, a great many small municipalities who cannot afford to take the risk of having to absorb the difference in cost on their own would start projects immediately. They were ready to do that, but decided against it because they could not meet the requirements. In fact, the government could easily do that and it would not cost any more money. It would not exceed its budget envelope, which would be fully used. And that is what it was established for to begin with—to stimulate economic recovery.

In any case, at some point we will have no choice but to wipe out the very significant deficit that now exists in Quebec and Canada with respect to infrastructure maintenance.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

Has the association surveyed its members? How many municipalities are affected by the deadline issue? Can you tell me how many projects may have to be cancelled?

[Gilles Vaillancourt]

With the chair's permission, I would like to table a list of projects. This is not an exhaustive list, but it is sufficiently telling for you to realize there is a real problem. It includes municipalities of different sizes, such as Saint-Hilaire, La Pocatière, Trois-Pistoles, Beloeil, Saint-Hyacinthe, Matane, Sainte-Marie, Côte Saint-Luc, Saint-Jérôme, Saint-Eustache, Terrebonne, Salaberry-de-Valleyfield, Gatineau and Longueuil.

We could also forward additional lists for your consideration.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

It is important for the committee to know how many projects could be cancelled, because of the concerns you highlighted. It is also important to know how many will be subject to much higher costs than expected, or at least higher than usual, and finally, how many will be scaled back or not completed. That is another possibility.

[Gilles Vaillancourt]

I did not understand the last part of your sentence, Mr. Kennedy.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

There are three different possibilities. Some municipalities will have to scale back their projects, others will have to bear all the costs on their own, or some projects may not be completed or will undergo considerable change—

[Gilles Vaillancourt]

We will ask the Union des municipalités to contact members to provide that information, which we will forward to the committee as soon as possible.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

That would be very helpful, because the Prime Minister has already stated that there will be no extension and that no flexibility is possible. I hope that, in light of your testimony and the committee's thoughts on this—it is still the only body with that responsibility—we can convince the government that it's all about success. For our party, this is truly a partnership, and we must be prepared to listen to what people have to say at all levels. There is no partnership if decisions are made unilaterally. Perhaps the government will recognize that.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Kennedy.

Monsieur Laframboise.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Thank you, Mr. Chairman.

I would just like to provide some clarification. First of all, I would like to thank the Parliamentary Secretary, Mr. Jean, who gave us an opportunity to have this debate, and I also want to thank the Conservative Party. It's important to give credit where credit is due, and he was interested in finding out what was going on.

I would like to come back to some of Mr. Généreux's comments with respect to the MRIF. The MRIF is a completely different program. It was introduced by the Liberals, and the Conservatives then invested more money in it. But what we are talking about is a one-time, “canned” and time-limited program, whereas the MRIF was over five years. In that case, there were specific deliverables.

Obviously, asking for a contribution from Quebec municipalities, which are already carrying 84% of the municipal debt in Canada, in the midst of an economic crisis, is already asking for quite a lot. I understand that some municipalities just did not want to go into debt, but others did take risks because they had specific needs. It is no accident that there is an infrastructure coalition: there are needs in that area and Quebec municipalities have some of the oldest infrastructure in Canada, something we must not forget.

Your Worship, you mentioned that new projects could be started, but I don't think that will be possible. In any case, announcements have already been made. Municipalities which were part of the program found that out when the announcement was made. They learned of this in December and they now have to complete the work before December. They are ready to accept that, but the problem is that their engineers or contractors cannot guarantee the result. They went into action to get the economy going and because monies had been earmarked for Quebec. However, what could well happen now is that the money will go back into the government's coffers and the municipalities will end up with a larger debt. Is that correct?

[Gilles Vaillancourt]

Yes, you are absolutely right, Mr. Laframboise. The municipalities have always been the government's partners. I regularly recall with great satisfaction the fact that the federal and provincial governments finally understood that there was a problem with our infrastructure and created programs to deal with it. These programs are often difficult to manage and do not necessarily reflect our scheduling needs; instead, they consider principles. That being said, what you have described does reflect the current reality: municipalities agreed in good faith to participate in an economic stimulus plan, encountered difficulties along the way, and will now end up bearing the burden on their own, something which I consider to be completely unfair to the partners who are doing this work, and without which, no work would have gone ahead.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

It is worth recalling that, for a period of about eight weeks, Quebec municipalities were penalized. That's important, Mr. Généreux, and you know that. They were penalized. They were not able to take advantage of a two-month period, whereas other municipalities in the rest of Canada, with more money perhaps, were able to take advantage of it. I know that there are municipal elections in other provinces—the committee will be hearing from officials representing municipalities outside Quebec—but the fact remains that there can be snags and that this is a fixed program, which is fine. That's fine, except that cities should not be penalized for attempting in good faith to stimulate economic recovery.

[Gilles Vaillancourt]

Once again, they have proven that they are good partners for the government. They should not be penalized for that.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Thank you.

[The Chair, Conservative, Merv Tweed]

Mr. Mayes.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you, Mr. Chair.

Your Worship, it's great to have you here today.

I also was a mayor, for eleven years, and a director of the Union of British Columbia Municipalities, so I understand some of the challenges municipalities have.

You mentioned there were three areas in which you felt Quebec was penalized with regard to the stimulus funding. One was the negotiations between Quebec and the Government of Canada. I know that British Columbia was the first to sign on, and we were the first out on the track, but Quebec wasn't that far behind. I don't think those negotiations were delayed any more than they were for some of the other provinces that have been successful in rolling out the stimulus money.

The other thing you mentioned was about municipal elections. As a former mayor, I can recall the transition from when I was first elected. I think the day after being sworn in I was signing a collective agreement with the union. There's a certain flow of responsibilities and decisions that go along even though there's a change in council.

I know that in the municipality I represented, we had a capital plan for roads and for upgrades of our infrastructure. Some of them were shelf-ready. There were various levels, but they were ready for funding, and we would hope we'd get some provincial or federal funding in the future.

I don't know if I, as a former mayor, particularly think the election disrupted that flow of decision-making and planning for infrastructure. The only thing I might buy a little bit is the weather, because I live in the California of Canada, and you get about two or three more weeks of winter here in the east. So I appreciate that.

One of the things our minister did as soon as he announced the stimulus funding was to tell all the members of Parliament to get out there and meet with their municipalities and sit down and find out what projects they had and how these moneys could apply. As a former mayor, the first thing I did was to have meetings with all seven of the communities and municipalities in my constituency. I told them to take the stuff off the shelves they had been hoping to do for a number of years, and it was really interesting, because we were able to get the money out right away. In fact, the chair and I were in the top five as far as MPs who were rolling money out went. So it can be done, but there's a process you have to follow to get it done.

As far as projects and timelines go, we were interrupted in British Columbia because we had a provincial election. There were no capital funding announcements for about two and a half months as we had the government re-elected. The fact is, the ministries changed, so we had a delay too. We had a rollout on May 12, but we didn't have another rollout until after August. There are those challenges, and that's part of the system we live in.

I believe that in government, as far as municipal government goes, you have those plans in place, and you're waiting for money. I think it was great that our government came out with the stimulus. Quite frankly, because this money was needed in the economy, we found that the major projects in my constituency came in at lower than was budgeted. One highway project that the Government of Canada funded to $12 million--it was a $25-million project--came in $3 million under budget. The second stage of that project came in at $1.5 million under budget. A sewage treatment facility was $1.5 million under budget. Because there was no investment by the private sector at that time, there was a capacity of engineers and contractors ready to go. We found we were able to get those projects up and going and get good prices on those projects.

I don't want to argue about the circumstances in Quebec compared to those in British Columbia, but I feel there is some responsibility upon the municipalities.

In most of the communities I had, there were projects on the shelf that they had reserved, set aside, so when the opportunity came up they could use those reserves to fund these projects. Is that not the system with the municipalities in Quebec, whereby they set aside reserves for future capital projects?

[Gilles Vaillancourt]

No, we don't have the same possibilities in Quebec to reserve capital funds. It's totally different.

First of all, I would like to thank the former mayor who is now a member of Parliament from British Columbia. As you were describing how you work in your area, I did feel a little envious.

That being said, we have no Conservative MP or minister in my city; nor is there a Conservative MP or minister from the Montreal region. The work that you did with your municipalities was not all done by the Minister. Mr. Paradis is a very nice man, very dedicated, and someone I really appreciate, but he has a lot on his plate and does not have time to visit the municipalities, other than calling them once on the phone to tell them to get things underway.

Furthermore, you can do all the analysis and make all the comparisons you want between your province and ours. Based on some criteria, you might turn out to be better in five years, but five years from now, we might also be better than you. I don't think we should be comparing what happened in British Columbia with what is occurring now in Quebec.

I don't know what the electoral tradition is in your area. I hope you followed events in the last municipal elections, particularly in the Montreal region. You would have seen for yourself that there was far more disruption than usual this time for town and city councils.

Having said that, I would just like to repeat that we are partners, and what we are asking is to be treated like partners. We acted in good faith, we submitted projects, we took all the appropriate steps to meet the deadline requirement. But now we are to be penalized for the good faith we, as partners, showed our government.

I would say—

If I may say it in English, great cities make great countries.

If you do what is needed to ensure that cities all across the country are healthy, then the country will be healthy as well. If Canadian cities are not healthy, you may think you have solved an accounting problem, but you will not have solved the country's problem.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Vaillancourt.

Mr. Kennedy.

[Gerard Kennedy, Liberal, Parkdale—High Park, ON]

Thank you, Mr. Chairman.

Thank you again for your testimony.

I would like to talk about the partnership again. Given that the associations showed flexibility in order to boost the economy, took risks and changed their priorities, the federal government should also show some flexibility, should it not?