Balancing Act — Public Infrastructure Aspects of the 2017 Ontario Budget
May 2, 2017
On April 27, 2017, Ontario Finance Minister Charles Sousa released Ontario’s 2017 budget, “A Stronger, Healthier, Ontario” (Budget). Significantly, the Budget is Ontario’s first balanced budget in a decade and as such, it contained few new infrastructure announcements. However, the Budget does continue to provide for significant allocations to infrastructure spending, allowing for C$156-billion in planned public infrastructure investment over the next 10 years, including C$84-billion in transportation, C$20-billion in health and C$16-billion in education infrastructure investment.
These investments represent an increase of C$30-billion in public infrastructure spending as compared to the 12-year plan set out in the 2016 budget. This increase is primarily the result of new investments in hospital projects, school renewal initiatives and the expansion of childcare.
The Budget shows that the province has earmarked C$84-billion for transportation infrastructure spending in the next decade, representing C$56-billion in public transit investment and C$26-billion for investment in highway projects. Although these funds are not specifically allocated to significant new projects, this funding continues to provide for the renewal and expansion of Ontario’s transportation infrastructure by supporting ongoing projects, including those implemented under the Moving Ontario Forward plan, the BuildON 2017 Infrastructure Update and Ontario’s Connecting Links program.
Ontario is continuing with its commitment to increase scheduled trips across the GO Transit rail network with the delivery of GO Regional Express Rail by 2024–25 and is also advancing work on projects on the Barrie, Stouffville, Lakeshore East and West, and Kitchener rail corridors, as well as extension of GO Transit service to Bowmanville and Niagara.
Transit projects already in progress across the Greater Toronto and Hamilton area, including the Eglinton Crosstown Light Rail Transit (LRT), Finch West LRT, Mississauga Transitway and York vivaNext Bus Rapid Transit projects, continue to receive funding in the Budget. The Budget confirms that requests for proposals for the Hurontario LRT and Hamilton LRT projects (both currently in procurement) are expected to be released in 2017. The Budget also indicates that the province continues to support ongoing transit planning for the Toronto Relief Line, Yonge North Subway Extension and rapid transit projects in the Greater Toronto and Hamilton area, including the Hamilton bus rapid transit line and transit improvements in London, Ontario.
The Budget also affirms ongoing provincial support for municipal transit infrastructure projects, including investment of up to C$300-million in the Waterloo ION Rapid Transit project and C$1.6-billion in Stages 1 and 2 of the Ottawa LRT, which are scheduled to open in 2018 and 2023, respectively.
Although no particular funding has been set aside, the Budget does indicate the province’s continued enthusiasm to work to bring high-speed rail to the Toronto, Kitchener-Waterloo, London and Windsor corridor, by beginning necessary the environmental assessment process and supporting additional design and planning. We note that Ontario is also considering the development of a governing body that would provide oversight over the work required to design and implement high-speed rail in the province, which would make Ontario the first Canadian jurisdiction to adopt high-speed rail.
While transit continues to receive the bulk of the province’s transportation spending allocation, Ontario is engaged in planning and design work to support a number of new investments in highway infrastructure projects on the province’s 400-series highways, on Highway 7 and in Northern Ontario through the Northern Highways Program.
The Province will provide more than C$20-billion in capital grants to hospitals, including new hospitals in Niagara and Windsor regions and the Weeneebayko area, as well as redevelopment of facilities in Hamilton and Mississauga.
The Budget includes investments of almost C$16-billion in capital grants to school boards. Moreover, the Post-Secondary Institutions Strategic Investment Fund — implemented in collaboration with the federal government, colleges, universities, and aboriginal institutes — will invest more than C$1.9-billion from 2016–17 to 2018–19 to modernize post-secondary campus research facilities including at institutions such as Durham College, Fanshawe College, Sault College, Trent University and the University of Toronto.
FEDERAL GOVERNMENT’S ROLE
In the wake of balancing Ontario’s books in 2017, the Budget does call on the federal government to adopt a flexible approach to funding as it rolls out the next phase of its federal infrastructure investment plan. As the Budget notes, federal funding (either through direct transfers or potentially, through the use of the Canada Infrastructure Bank) will allow Ontario to build more infrastructure in an era where balancing the books has necessarily resulted in a constrained infrastructure spending plan.
The Budget demonstrates the province’s continued commitment to supporting ongoing transportation infrastructure projects, as well as an increased focus on health and education infrastructure spending. The Budget also notes that more details of Ontario’s development strategy will become available shortly, with the release of the long-term infrastructure plan. We will provide further updates on those in due course.
For further information, please contact:
Catherine Doyle 416-863-4160
Mark Johnson 416-863-3318
Vivian Kung 416-863-4253
Judy Wilson 416-863-5820
Marianne Smith 416-863-3156
Christine Ferguson 416-863-3094
Alain Massicotte 514-982-4007
Jeffrey Merrick 604-631-3386
Carrie Fleming 604-631-3367
or any other member of our national Infrastructure group.
Posted in: Infrastructure
Blakes and Blakes Business Class communications are intended for informational purposes only and do not constitute legal advice or an opinion on any issue.
We would be pleased to provide additional details or advice about specific situations if desired.
For permission to reprint articles, please contact the Blakes Client Relations & Marketing Department at firstname.lastname@example.org. © 2019 Blake, Cassels & Graydon LLP