Transport Committee on April 27th, 2021

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Mr. Chair.

My question is for Ms. Skivsky.

We often hear about the great need for infrastructure, but we also hear a lot from municipalities about the fact that infrastructure is expensive, which is normal. Are there ways to bring the costs down? I have a number of ideas in mind, but I would like to hear your thoughts.

It seems that some contractors are reluctant to sign up for certain programs or projects because they wonder whether they will get paid next year, in five years, or in 10 years. Contractors sometimes worry that they won't get their money. They think they may not be financially strong enough to wait that long to get paid.

Could other methods be put in place to help our local contractors? A wider range of contractors, as well as local people, might sign up. Some also say that the big city companies always get the contracts and the small ones are often left behind.

[Sandra Skivsky]

It's true that there is a reduction in the number of firms that will bid certain types of projects. We hope that when the federal government gets prompt payment implemented, some of the payment issues will be a bit relieved on some of these projects.

I do take your point. For a trade contractor to take on a project, they have to invest at least two months' worth of work, labour and everything before they start to get paid. They can only take on so many projects. If the project is too big, it will impact the company's cash flow to such an extent that any payment delay could be catastrophic.

Bundling projects into large megaprojects doesn't always work to get local people, local firms, working on those particular projects. If they were given out as separate contracts, you could probably get more local interest.

You're right. Anything that stretches out a payment term for a small contractor is difficult. Your pool of available bidders becomes reduced, and as I said, bundling several medium or small-sized projects into one large project also starts to exclude some of these players.

The other thing I would emphasize is that if it's infrastructure spending, Canadian firms should be looked at preferentially, because bringing in foreign companies to do work in Canada with taxpayers' dollars is another topic about which some of our NTCCC folks are particularly sensitive.

You're right, these projects could be made more accessible.

[The Chair, Liberal, Vance Badawey]

Thank you, Ms. Skivsky and Mr. Barsalou-Duval.

We're now going to move on to the NDP, Mr. Bachrach, for two and a half minutes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

Mr. Frizzell, the recent budget included $1.5 billion towards the rapid housing initiative, but this falls considerably short of what it's going to take to meet the government's stated goal of ending chronic homelessness in Canada. Could you tell us, from FCM's perspective, what it is going to take to meet that goal?

[Garth Frizzell]

We did our forecasting for our pre-budget submission, and it's going to cost $7 billion. This addition to the rapid housing initiative is welcome and it's helpful, but we still have a ways to go on our shared goals towards ending chronic homelessness.

I'm going to pass it to Mr. Gemmel for the details, but this partnership is unprecedented, and having that connection directly from the federal government to local governments is welcome and critical to us.

[Matt Gemmel]

Thank you, Garth.

I'll say a couple of things about the rapid housing initiative. The first is relevant to our discussion today about the mechanisms around how funding is delivered to other orders of government. The rapid housing initiative is a model in that regard, in that it doesn't follow a strict federal-provincial-territorial funding agreement model as so much other affordable housing and infrastructure funding does. It has an element that provides funding directly to municipalities on an allocation basis, based on population and need. That's quite a change from how affordable housing funding has been delivered in the past.

The second thing that's noteworthy is that it's quite an innovative funding model in that it responds very directly to the unique context presented by the COVID-19 pandemic. It provides funding for municipalities, non-profits and housing providers to purchase properties, hotels and apartment blocks that are at a low market value as a result of the pandemic, with the goal of reducing overall operating costs. Municipalities and social housing providers spend a lot of money renting motels and hotels to provide emergency housing for the most vulnerable residents in their communities. Providing permanent housing and in certain cases supportive housing that involves wraparound social and health supports is a proven best practice and is more cost-effective for the taxpayer.

In terms of the need, the federal government has made the commitment to end chronic homelessness, and that is a laudable goal that FCM and our members fully support. It's going to require serious long-term resources and a long-term funding commitment.

The commitment we saw in the recent budget is the right rate of investment, but it doesn't provide the length of commitment that we are looking for and falls short of the overall $7 billion figure that FCM and other housing stakeholders arrived at as a cost of providing permanent supportive housing for the estimated number of Canadians who are experiencing homelessness.

[The Chair, Liberal, Vance Badawey]

Thank you, Mr. Gemmel and Mr. Bachrach, for your questions and the interventions.

We're now going to move on for five minutes to the Conservatives.

Mr. Soroka, you have the floor for five minutes.

[Gerald Soroka, Conservative, Yellowhead, AB]

Thank you, Mr. Chair.

Mr. Frizzell, you spoke about Internet. That's been a big issue for a lot of people in my riding as well. I'm concerned about the failures of this government, being in power for six years and having five different funding streams and poor communication between each one of the organizations that offer funding.

I know municipalities can't apply for all the funding levels from these different grant programs, but are you finding or have you heard from other municipalities that they're either putting fibre optic or they're trying to connect in one community and they'll jump over two and three communities to get to another one? They're poorly servicing rural Canada. Have you experienced this?

[Garth Frizzell]

Thank you very much, MP Soroka, through the chair.

Let me start by saying that the news today is from a small community northeast of mine, Tumbler Ridge, which lost its entire Internet connectivity when a beaver chewed through the fibre optic line. As for constructing new lines, that was a one-off, funny incident, but it's not so funny in rural Canada, because we see that a tractor can go through a line and, in 2017, the wildfires that razed northern B.C. eliminated Internet connections as well.

As it's being constructed, yes, we see that there are.... I'm thinking of local examples, where the Internet implementation jumps from community to community as they're doing consultation. With the universal broadband fund, while we were happy that the intake was extended, but here are a few of the things that we're calling on the federal government to do right now.

We want to maximize the investment outcomes by ensuring effective coordination between the Internet service providers and the local government through FCM, and with provincial and territorial governments and federal departments and agencies.

We want to deliver on the commitment to expedite funding delivery. We want streamlined application processes and a one-window intake, especially for the smaller communities you're talking about. They need help. They need to have some support, because they just don't have the capacity.

Third, we're asking that we continue to measure and report on the progress and regularly reassess timelines and the level of public investment that's required.

This is urgent. We've got to get all Canadians connected.

[Gerald Soroka, Conservative, Yellowhead, AB]

I know that the gas tax is quite a benefit. That was actually started by the Conservative Party. They first implemented that.

One of the things I wanted to ask you about is when you take that $2 billion and divide it amongst all the municipalities. It's nice, predictable, stable funding, but the problem is that for a large municipality it comes down to only about a couple of hundred thousand. You can't even pave a kilometre of road for that kind of money.

Does the FCM have a recommendation for where it would like to see that number, or is this something that's not even talked about?

[Garth Frizzell]

Thank you.

Our recommendation was to double the gas tax for three years coming out of the pandemic.

I did want to emphasize one of the benefits with the funding that comes through the gas tax fund. It's not just creating new infrastructure. It's also maintaining existing infrastructure. That can be incredibly helpful for small and large communities alike. We'll always welcome increases to the volume, of course, to the size of the funding, but we're certainly able to welcome the doubling.

Thank you.

[Gerald Soroka, Conservative, Yellowhead, AB]

My next question, Mr. Chair, is for Mr. Gamble.

You mentioned that there's a lot of money that goes out to municipalities that apply for funding, but it's not necessarily for a need for their community. They have to apply because the grant is there for a water system or a road, but they need to have housing, and that grant isn't available. Are you finding that these should be better tailored to each community versus just a generic grant application?

[John Gamble]

Well, again, I think part of the solution is leveraging the asset management plans that many municipalities have invested in. For municipalities and other communities—and this is certainly true of first nations, where there may be less capacity to develop these plans—we should do everything we can to give them this capacity. The idea is to match the available funds to the actual needs that have been determined on the ground.

The other piece of this that I alluded to is that there is a potential for the national infrastructure assessment to make them more global, because one thing infrastructure does is that it doesn't just build communities. It also connects communities and allows commerce and all these other important things to happen.

There's a real opportunity there to make sure that programs are right-sized and rightly targeted, and that in terms of capacity in the municipalities—and this was alluded to by Mr. Frizzell, I think—if we have great capacity and decision-making in the municipalities, it takes a lot of the burden off the federal government to put on all these check boxes and lenses and filters. If we're relying on the public servants and elected officials in the community to make sure funds are invested correctly and in a reasonable way, that will help.

I don't think we have to throw out the baby with the bathwater to get to where we need to be, but I think we have to get all the parts working together a little better.

[The Chair, Liberal, Vance Badawey]

Thank you, Mr. Gamble, Mr. Frizzell and Mr. Soroka.

We'll go now to our last speaker.

Mr. Fillmore from the Liberal Party, you have the floor for five minutes.

[Andy Fillmore, Liberal, Halifax, NS]

Thank you, Chair.

To our witnesses, thanks so much for joining us tonight and for sharing your experiences and observations. It's very important that we hear from you.

I'm not quite sure where to start here. My colleagues on the committee know that I was a city planner for more than 20 years before coming to this job. I look at my work through that lens. You can't take the planner out of the kid, I guess. Because of my closeness to this file, I want to make sure we all understand that it was actually Paul Martin and the Liberal government that created the gas tax fund and made a requirement for integrated sustainable community funds and so forth that allowed access to that fund. Of course, that was in response to the starvation diet that cities had been on in a previous Conservative government. Then we saw that pattern repeat, leading up to the Liberal government in 2015.

We don't have to think back too far to remember the famous FCM report card on the state of municipal infrastructure in 2014-15. The phrase I remember is “a ticking time bomb of unfunded liability”. I certainly quoted that report card on just about every doorstep I stood on in the 2015 election.

What a distance we've come since then. We are now in a generational investment in community infrastructure. We are changing the appearance and the functionality of our country in our communities from coast to coast to coast. We have thousands of projects approved under the ICIP, with $180 billion at stake and with, of course, I should point out, no funding lapses. There's no such thing as funding lapses. It just gets carried over into the following year.

Right when we were hitting our stride with that, along came COVID. We answered the call again with the safe restart fund that we mentioned tonight; doubling the gas tax to puff up municipal coffers in their moments of need; and the rapid housing initiative. In fact, at two sites in Halifax, holes were dug in just the last week under the RHI.

There's a lot going on here. In fact, in the pandemic period just since March 2020, we approved over 3,100 projects worth over $4 billion. The vast majority are under way. They have actually commenced. I mean, these are the times when the planner in me can hardly believe it. I've been waiting for this my whole life, and I think maybe the witnesses have too. It's something that I could only dream about, back as an idealistic student, in terms of investing in communities in this way.

I know that I got a lot off my chest there, but I'm very excited, as you can tell. I want to land with the $1.5-billion green and inclusive community buildings fund. What we're trying to do is bring the economy back and create jobs, reduce GHGs, and create an inclusive economy and recovery in which everybody can participate. Community building is a beautiful way to do that.

Ms. Skivsky, I was particularly interested in your connection of that to building local capacity and local knowledge and training. I wonder if you or anyone else would like to jump in and talk about the impact of that program on communities and on our recovery.

[The Chair, Liberal, Vance Badawey]

Ms. Skivsky.

[Sandra Skivsky]

I'm not sure I can speak directly to that very effectively. On my point about the training and leaving behind that skill and knowledge set, I think John mentioned the continuing impact of infrastructure long after we've all finished dealing with it. Part of that is making sure that those skills are there. A lot of that skill capacity is part of that construction contract. If we could improve on that, and have that training for people to participate in not only the construction aspect but also the maintenance, repair and ongoing support for that infrastructure moving forward....

Again, I'm talking about remote communities where every time the pump breaks you have to fly somebody in to deal with it. You want to get away from that. You want to create more sustainability at source.

[Andy Fillmore, Liberal, Halifax, NS]

Does anyone else want to jump in on the impact piece?

[Garth Frizzell]

My brother is chair of the Sunshine Coast minor hockey league, so I'd be remiss if I didn't point this out: We're responsible for 7,000 hockey rinks all across Canada. That's central to Canada. There's a big opportunity here for energy retrofits. It's substantial, so we're looking forward to implementing that. In fact, I think tomorrow is our first webinar on accessing that community building retrofit fund.

Thank you.

[The Chair, Liberal, Vance Badawey]

Thank you, Mr. Frizzell. Thank you, Mr. Fillmore.

Well done to all of you.

We had great interventions and great questions from the members.

To the witnesses, I want to take this opportunity, on behalf of the committee as well as the government, and all of us in the House of Commons, to thank you for coming out and giving us your time, for passing on your thoughts and experiences with respect to working with the federal government, particularly as it relates to infrastructure.

As a former mayor for 14 years here in Niagara, I have to say it's a blessing we have such a close-knit connection between the federal government and our local government municipalities. I won't even say municipalities, I'll say communities. It's like a house compared to a home, a municipality compared to a community.

To all of you, thank you for that and for those interventions.

As well, I want to extend my sincere appreciation to a lot of you for mentioning asset management, and, of course, from asset management, the PSAB, which you all work on. I know it's very difficult to capitalize your assets, of course attach an asset management plan to that when it comes to repair and maintenance throughout its life cycle, and, obviously, when this life cycle then concludes, to replace that facility. I know a lot of you are trying to really top up those reserves to keep up with that maintenance, and then, obviously, at the end of the day, that replacement. You're starting to do it, though, and hopefully you're doing it with our help.

With that, again, thank you for what you do at the local level, and thank you for working very closely with us. We look forward to working with you folks well into the future. You folks have a great evening.

To members, we are now going to adjourn the public portion of this meeting, and we're going to step into an in camera meeting. I will give you about five minutes to log out and log back in.

Thank you.

[Proceedings continue in camera]