New Building Canada Fund open to applications April 1

After Prime Minister Stephen Harper announced details of the New Building Canada Plan last week, reactions have been mixed.

Speaking in York Region, north of Toronto on February 13, the prime minister presented the policy framework for how the federal government will set up “the largest federal infrastructure investment in Canadian history.”

The New Building Canada Plan, said the Prime Minister, will provide stable funding for a 10 year period, amounting to a total of $53 billion for provincial , territorial and municipal infrastructure.

The funding under the Plan is organized under a variety of programs, and includes $32 billion from the existing Gas Tax Fund and the Goods and Services Tax Rebate for Municipalities.

In addition, the $53 billion incorporates a New Building Canada Fund of $14 billion, divided up into $4 billion for national projects and $10 billion for provincial-territorial-infrastructure projects. And it will allocate $1 billion for projects in communities of less than 100,000 people.

The government says that it wants to ensure a “seamless transition” from the 2007 Building Canada Plan to the New Building Canada Plan, and to avoid the delays that occurred in 2007, the government will not require framework agreements with provinces and territories. The government has said it will start accepting applications to the New Building Canada Fund by April 1.

Reactions from various organizations in the construction industry have been positive, with qualifications.

The Association of Consulting Engineering Companies-Canada issued a joint statement with the Canadian Construction Association. It read: “ACEC and CCA have advocated for a long-term infrastructure plan for many years and applaud today’s announcement. The NBCF [New Building Canada Fund] will enable both governments and private sector partners to properly plan and resource major infrastructure projects which will provide better value to taxpayers and reduce overall costs.”

ACEC and CCA went on to say that they are looking forward to working with the government and other stakeholders to ensure an efficient application process.

Not surprisingly, the Canadian Council for Public-Private Partnerships (CCPPP), praised the government’s decision to require projects that have a cost of $100 million or more to undertake a screening process to determine whether they should be done as a public-private partnership.

However, the screening process, which will be done by P3 Canada, could take between 6 to 18 months.

This potential time delay is cause for concern by the Federation of Canadian Municipalities. Claude Dauphin, president of FCM, issued a statement praising the new fund and the government’s long-term commitment to funding infrastructure. It also welcomed the dedication of funding to small communities, recognizing “that small, rural, remote and northern communities need greater predictability and access to infrastructure funding.”

But FCM has concerns about “rule changes that could force municipalities to carry a larger share of infrastructure costs in the future, the eligibility rules for local roads, [and] the screening process for projects structured as public/private partnerships.”

Under the new formula, the maximum federal contribution will be one-third of the total eligible costs of a project, but there are exceptions. For provincially-owned roads and public transit projects that are traditionally procured the maximum federal contribution will be 50%. For public-private-partnership projects and private sector projects the maximum federal contribution will be 25%. For all projects located in the territories, the maximum federal contribution will be 75%.

To see more details about the New Building Canada Plan, including the New Building Canada Fund, click here.