According to the Federation of Canadian Municipalities (FCM), municipalities are responsible for maintaining and delivering most of the infrastructure and services that support Canadians in their daily lives, including roads, water, public transit and essential community services.
As our country experiences historic population growth, municipalities are struggling to fund these services under a 19th-century revenue framework that was never designed for the realities of the 21st century.
To ensure cities can meet the growing pressures, the FCM is calling for a new Municipal Growth Framework to address the funding imbalance and shortfalls.
Important recommendations in the report
- Increasing direct annual transfers to municipalities by $2.6 billion. Paired with the existing Canada Community-Building Fund allocations, this would bring total annual federal transfers to $5 billion.
- Linking federal transfers to economic growth by indexing them to Gross Domestic Product (GDP) so the amounts will change as the GDP changes.
- Broadening eligible expenses under federal transfers to include operating costs as well as capital costs (infrastructure), so municipalities can direct funding towards local priorities that enable population growth and economic development. This recognizes that municipalities are in the best position to identify and respond to local needs.
- New investments in supportive housing through a housing-first approach to cost sharing between federal, provincial and municipal governments.
The Big City Mayors’ Caucus of FCM and the FCM membership have endorsed the Municipal Growth Framework and are advocating to the federal government and opposition parties for the adoption of its recommendations.