Thank you very much.
Thank you very much for having us here today.
I am very pleased to be here to discuss progress regarding the Investing in Canada infrastructure plan.
It's important to have this conversation with this committee. We have had a few conversations with this committee over the years around important questions of infrastructure.
FCM represents nearly 2,000 municipalities serving approximately 90% of the Canadian population.
We welcome this initiative of the committee, as we think it's necessary to check in regularly on the progress of infrastructure plans to ensure that the plan is driving the outcomes Canadians deserve.
We believe the investing in Canada plan can transform our country. As you know, municipalities are responsible for 60% of Canada's public infrastructure. They have a track record of turning predictable federal investments into growth and quality of life outcomes. This federal plan helps ensure that municipalities have the long-term predictability they need to move forward.
Through phase one of investing in Canada, municipalities were able to drive rehabilitation, planning, and design work to prepare for the nation-building projects that come in phase two.
For example, during phase one, Surrey, British Columbia, is supporting the design work and the upgrades to sewers, bridges, and utility corridors. That work is generating economic benefits for that community now. It's also laying the foundation for Surrey's phase two light rail transit expansion, which will mean 24,600 person-years of employment and a more livable city to attract talent and investment. The two phases are working hand in hand nicely in some places.
We have been deeply engaged in shaping phase two. We've always known that its success would hinge on federal negotiations with provinces and territories, known as the integrated bilateral agreements. As these negotiations lead to bilateral agreements, what we see is encouraging. We see a deep recognition of local governments' role in nation-building.
I would like to draw the attention of this committee to three features of the bilateral agreements that we find particularly important.
First, there is the commitment to support a fair balance of municipal and provincial projects through funding. That means local projects aren't just “nice to haves”; they're “must haves” for Canada. We have always said that local solutions can solve many of our biggest national challenges. Better transit and roads ease local gridlock, but they also boost Canada's productivity. Scaling up local green infrastructure helps achieve Canada's climate change goals. Ensuring a fair balance between provincial projects and municipal projects is an important feature in phase two and in the bilateral agreements.
Second, these agreements enshrine meaningful cost-sharing to move local projects forward. The key value municipalities bring to the table is not just money, but expertise in delivering solutions that work. That's why FCM recommended a cost-sharing of 40-40-20—40% federal, 40% provincial, and 20% municipal—as the appropriate cost-sharing for phase two. The federal government has now adopted the 40% benchmark, and provinces are committing to 33%. Seeing three-quarters of local project capital costs covered is very significant for the municipalities. This underlines that Canada needs these local projects to move forward, and the municipalities will make the most of every tool available.
The third feature of the integrated agreements is the commitment to ensuring progress in rural and northern communities. FCM has always insisted that a credible nation-building plan must include communities of all sizes. It must recognize the financial and administrative realities of rural and northern communities. Therefore, to move projects forward, Ottawa has now boosted its cost-share to 50% for rural projects and to 60% where populations fall below 5,000. Building on that, the bilateral agreements are looking to streamline rural project administration, easing barriers to better roads, broadband, and waste water treatment.
While these are big commitments, there's more work to do to turn them into real progress and outcomes. All orders of government have learning to do as we go through the experience of closing phase one and into phase two.
In summary, over the past year, FCM took time to reflect on phase one. We had a meeting with the federal and provincial ministers of infrastructure to discuss improvements for phase two. We recommended that fair balance, cost-sharing, and special attention for rural Canada are lessons from phase one that were essential to effective delivery in phase two. We have to give credit to Minister Sohi and his team for listening, for understanding, and for following through in the bilateral negotiations on phase two.
The bottom line is we need to get phase two right. Local governments are fully committed to making that happen. Local governments will be out there delivering real outcomes long before they can file the receipts that show up in federal government spending numbers.
Local governments will be out there moving the big national needles: the economic growth, the productivity, and the emissions reductions. Local government will be building livable, competitive communities that Canada needs to thrive, the kinds of communities that will attract and support the growing businesses, the talented workers, and the innovators we need in this country.
That's the value municipalities bring to nation-building, and that's what drives us as partners for the federal government.
We would like to thank the committee for their attention to this issue, and we look forward to questions later.