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The bulletin is prepared by John Sewell, the site manager, with the assistance and under the guidance of the advisory committee. It is published monthly, and is being sent to a wide range of people across Canada. Past copies of the bulletin will be archived in this section of the site.

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Bulletin No. 28, June 2002
Local Government Bulletin No. 28, June 2002

The purpose of this bulletin is to focus debate on the need to increase the powers and authorities of local government in Canada and to ensure local communities achieve more autonomy. The new Local Government website is http://www.localgovernment.ca . This site replaces www.localself-govt.org .

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In this issue:
1. The continuing saga of federal money and municipal desire
2. Quebec proposes a slice of the Sales Tax
3. Fleshing the Community Charter Bones in British Columbia
4. Subscribe to this bulletin
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1. The continuing saga of federal money and municipal desire

For a while in early June there were high hopes the federal government could allocate funds for municipal projects, but that expectation has not almost entirely evaporated.

The optimism began with a May 31 speech by Paul Martin, then Minister of Finance, to the Federation of Canadian Municipalities. Martin talked about a `New Deal for municipalities’ that would apply not just to cities (where 80 per cent of Canada’s population lives) but to all municipalities. He noted that the development of affordable housing and new transit infrastructure were beyond the financial capabilities of local governments and that generally the investment in infrastructure required to support and create jobs – roads, sewers and other services – was at risk because of local financial constraints.

When it came to the actual details of the New Deal, Martin was not particularly clear, save that provincial involvement would need to complement federal commitments. He expressed a personal reluctance to provide dedicated taxes (that is, a set proportion of a particular tax) and suggested regular consultation with municipalities in the preparation of federal budgets might be appropriate. His conclusion offered hope for change: “Let’s shed conventional wisdom. Let’s move beyond the tyranny of inertia that lies behind the objection, `But that’s the way it has always worked.’ Let’s go from this meeting with one thought in mind. And that is to make a New Deal for municipalities a reality for Canadians.” (Martin’s speech can be found at http://fcm.ca and follow the links to reports from the FCM annual conference.)

The lack of substance was shrouded by the promise of change which fell crashing to the ground a few days later when Martin was removed from the Cabinet by prime Minister Jean Chretien, apparently for making this speech without first clearing it with the prime minister’s office. Martin’s successor in the Finance post, John Manley, has since made repeated statements that there would be no new money to municipalities from the federal government.

Of course, this is not the end of the discussion, just a hiatus while the political horses are re-arranged in Ottawa. Few believe that the issue will die but it clearly it is not being resolved with an alacrity.

2. Quebec proposes a slice of the sales tax

In early June, at the close of the Summit of Montreal, Quebec Premier Bernard Landry offered the possibility that Montreal could have access to provincial funds, perhaps even part of the provincial sales tax. This is the first time this kind of offer by a province has been made to a municipality in Canada. To date the only sources of tax sharing revenue have been petroleum taxes in Alberta and British Columbia.

The announcement came as the Premier and Montreal mayor Gerald Tremblay signed a `City Contract’ outlining how the two governments will relate over the next few years. The contract is full of general ideas about cities and outlines the current priorities that should be addressed – the usual ideas such as creating more jobs, supporting families, guaranteeing a dynamic cultural life, and improving infrastructure. (The text of the agreement in French can be found at http://mamm.gov.qc.ca/mamm.html .)

As reported in the Montreal Gazette, about $7 billion a year is raised by the provincial government from sales taxes, so a small slice would be a sizeable contribution to Montreal’s budget. At the same time the provincial government has announced new spending on infrastructure within the city including money for new hospital centres.

There are two downsides to this announcement. The first is that it is easy to interpret the contract between the city and province as simply an extension of the control exercised by the province over local governments with the forced amalgamation in most urban areas last year. The contract signals that the province is jumping into local administration in a fairly big way, and that augers badly for local autonomy. This may be an example of the province giving money in exchange for control.

The second problem has to do with the meaning of the document signed by the two leaders. The content of the `Contract de Ville’ will be finalized in the next six months and signed by the city and the province before the end of November. In an editorial on June 7, the Montreal Gazette noted, “This will be an agreement on which responsibilities Montreal will take over from the province. The list, we are told, might include any or all of subsidized housing; downtown; disadvantaged neighbourhoods, social development; family support; welcoming and integration of immigrants; infrastructure; industrial development and high technology; culture; local economic development; sports and recreation; tourism; transportation; protection of natural spaces; and soil decontamination.

“What an amorphous list. What will it mean to be `responsible’ for downtown?

“If Montreal is in charge of industrial development, will the province still dole out the interventionist grants to companies Mr. Landry loves so well? If so, will Montreal be allowed to bid against, say Hull, for a given factory?”

The editorial concludes, “As always, there are political wheels within wheels here. The only bottom line, so far, is that Montrealers will have to wait another five or six months to see if this is a good deal or a bad one.

“The relationship between the city and the province is asymmetrical: Quebec has all the power. A premier with re-election problems, whose party gets clobbered in Montreal, will be tempted to give the city more duties than money, liberating cash for `investment’ in swing ridings elsewhere.

“Are we being too suspicious here? We would be delighted if Mr. Landry demonstrated that, by really negotiating this contract, rather than imposing it. But realism born of bitter experience warns Montrealers to beware of Quebec City politicians bearing gifts.”

This announcement came at the end of the `Summit’ held in Montreal, a gathering used by more and more cities as a problem-solving mechanism. Ottawa held one last year (Vision 2020) that caused considerable excitement at the time but has had no lasting impact on political or administrative decisions. Toronto plans a similar kind of summit for the last week of June and one suspects that it too will be of little long term influence. Rather than climbing to the summit one wonders if cities might do better with another analogy - getting down to the nitty gritty.

3. Fleshing the Community Charter Bones in British Columbia

Last August the government of British Columbia passed the Community Charter Council Act, promising significantly more autonomy for local governments in British Columbia. Since that time a consultation process has been used to flesh out the principles set out in the Act in order to create new legislation that will govern local governments. (Bulletin 19, at our web site http://www.localgovernment.ca , provides an initial description of the legislation.)

Since then it’s been hard slogging. A consultation process with local government representatives and others has been established with Ted Nebbeling, Minister of State for the Community Charter. The details of the proposed charter appear more difficult to agree on than the principles were to express, but perhaps that is to be expected in a process promising autonomy, increased powers, more financial resources, and provincial respect at a time when the provincial government itself is significantly downsizing the public sector in British Columbia.

Nevertheless the documents outlining the discussion so far are useful to review to get a sense of the possibilities for local autonomy. Most can be found on the website of the Union of Municipalities of British Columbia, ( http://civicnet.gov.bc.ca and follow the links to the Community Charter documents.) Further information may be found on the government’s website, www.mcaws.gov.bc.ca/charter/index.htm

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