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LOCAL GOVERNMENT BULLETIN – No.35, February 2003

The purpose of this bulletin is to focus debate on the need to increase local self-government in Canada and to help local communities achieve more autonomy. The local self-government web site is http://www.localgovernment.ca

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In this issue:
1. A local presence at the national level
2. Solving the soft-wood lumber dispute locally
3. Winter Doldrums?
4. Subscribe to the Bulletin
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1. A local presence at the national level

There were many complaints that the federal budget released on February 19 does not respond to the needs of cities in particular and smaller municipalities in general. This is quickly becoming a standard complaint at budget time and perhaps a new question should be asked: What can local governments do to get a better hearing at the federal level in Canada?

The Association of Municipalities of Ontario summed up the problem succinctly, and while its data applies to Ontario, the general argument can be made nation-wide:

* The 2001 average Ontario family total tax bill was $36,497. The federal take was about 60%, the provincial share about 33% and municipalities got about 7%. Income taxes make up the largest single component of the average Ontario family’s tax burden at almost 35%, followed by sales tax at about 18%. A typical family would pay about 6 times its property tax burden in income taxes and 3 times in sales taxes.

* Income and consumption taxes, not property taxes, are a better reflection of ability to pay. Income taxes and consumption taxes as a share of total governments’ revenue grew 15% and 22% respectively from 1997/98 to 2001/02. Property taxes grew in the same period by only 6.2% - clearly not as responsive a revenue source.

* The federal government collected about $4.3 billion in gas tax alone in 2002. The Federal budget announcement only earmarks $100 million/year nationally toward municipal roads and bridges, as well as sewer and water infrastructure. In 2000, the federal contribution to the Canada-Ontario Infrastructure Program was $680 million over 6 years, but it was fully used before the end of the program’s third year. (See AMO’s Backgrounder, February 20, 2003, at http://www.amo.on.ca . )

Many commentators noted that the new expenditures outlined in the budget will be enjoyed by individuals, but that there was not enough recognition of the needs of urban areas where much of the federal government surplus has been generated during the last decade.

Yet this budget was produced at a time when there has been more talk than ever before about the importance of cities in the Canadian economy. Many large city mayors, such as Winnipeg’s Glen Murray, have spoken out forcibly about the limited tax revenues available to cities compared to provincial and federal governments. The C5 Coalition, brought together by Alan Broadbent and Jane Jacobs to help the mayors of Vancouver, Calgary, Winnipeg, Toronto and Montreal meet over the last 18 months, has made similar points and has attempted to engage leading federal politicians. The Federation of Canadian Municipalities has considerably sharpened its focus on national policies and money related to local government, and one of its champions, Jack Layton, recently elected leader of the federal New Democratic Party, has attracted considerable attention with his statements.

Nevertheless, these initiatives appear not to have been significant enough to make a serious change at the federal level. Is the `city issue’ a lost cause on the national stage? Or are there other strategies that may lead to a change in the relationship between the national government and municipalities?

A year ago Toronto Councillor David Miller made an interesting proposal to better engage senior government politicians in local issues. He proposed that Toronto City Council convene what he called the Toronto Assembly, a meeting of all elected officials within the City of Toronto – councillors, Members of the Legislative Assembly, and Members of Parliament – to begin talking about the challenges facing the city and how cities were treated in other jurisdictions. He thought the Assembly should be a continuing dialogue, although his proposal did not specify how often the Assembly might meet. Sadly, the proposal was referred to the Mayor’s Office and has not been heard of since.

“Members of Parliament have not been made accountable on city issues,” Miller said after the February 19 budget, “whereas MPs from rural Manitoba or Saskatchewan are seen as passionate advocates for their communities. A lot of what we are talking about here is not partisan and does not depend on your political party.”

This small organizing device – regular meetings of those elected from the same turf to serve at different levels of government – seems to happen very infrequently in large urban areas in Canada. It probably happens more frequently in smaller communities where only one or two people are elected to provincial and federal governments rather than in more complex communities where one or two dozen are elected. A recent call-around to large Canadian cities reveals that nothing comparable to the Assembly proposal exists in any large city in Canada. In Calgary and Alberta locally elected MLAs meet irregularly – perhaps once a year – with their respective councils. The mayor’s office in Calgary says, “There are no formal meetings between the federal and municipal levels of government.” Similar statements were made in other cities.

Councillor Clive Doucet of Ottawa says there is a real divide in that city between councillors, MPPs and MPs. “It is hard to believe we are so distanced from each other,” he says. As in other cities, Doucet says there are occasional one-on-one meetings where a councillor deals with his or her counterpoint at the provincial or federal level, but there are no government-to-government meetings.

Doucet thinks that the big problem with establishing something like an Assembly would be that since most elected officials have jam-packed agendas they might find reasons not to attend. He believes a good start would be to schedule a meeting at the beginning of a new year with an agenda agreed upon between the different politicians. Everyone could come together and participate in a joint debate about local issues involving other governments, and vote on the actions to be taken. “This kind of a process would force the city to think about its agenda,” says Doucet.

The issue is not whether Doucet’s model or Miller’s is better. Rather, it is about forging new structures that will better link those elected to provincial and federal governments to those elected at the local level. Canada is large enough that a number of different models could be tried and, hopefully, some of them might function well.

2. Solving the soft-wood lumber dispute locally

This may be a good time for the kind of local/national experiment suggested above - it would follow neatly on the heels of a joint initiative of the Federation of Canadian Municipalities and the Government of Canada around the soft-wood lumber dispute.

The Americans have imposed a 27% duty on Canadian soft-wood lumber, with an enormous impact on Canadian industries, and some influence on American prices. Negotiations between the two countries at the national level have not brought a satisfactory solution for Canadians.

This initiative involves leaders from affected Canadian communities taking their case to communities across the border. The task force, co-chaired by Mayor Jamie Lim of Timmins, Ontario, and Councillor Joanne Monaghan of Kitimat, British Columbia, is just wrapping up a trip that took it to Springfield, Missouri; Milwaukee; Fort Lauderdale; New Orleans; St. Paul; and Los Angeles. Monaghan says the trip follows up an encouraging visit in January by local leaders to the U.S. Conference of Mayors in Washington. (For further details see http://www.fcm.ca )

Could involving local governments in this way be the start of a better way to focus these kinds of trade issues?

3. Winter Doldrums?

Is it the end-of-winter blues or just me? There seems to be a somnambulance on the larger municipal scene, with a dearth of new initiatives to strengthen local government. Maybe I’m just not getting the good news that others are generating, or maybe it just isn’t happening. If you see signs of life, let me know at j.sewell@on.aibn.com and I’ll rush to investigate.

4. Subscribe to the Bulletin

The bulletin is sent, at no cost, to about 1500 individuals involved directly or indirectly in local government in Canada. The next bulletin will be available in April 2003. Those who receive this Bulletin directly (not forwarded by a third party) are already part of the subscription list. Others who wish to subscribe should go to the web site http://www.localgovernment.ca and follow the instructions. To unsubscribe, please send a message to info@localgovernment.ca indicating your wish to unsubscribe.

More information about the sponsors of the bulletin, a library of relevant and useful documents, and an archive of past bulletins, can be found on our web site. We appreciate your comments, your feedback (to j.sewell@on.aibn.com ), and items of interest that you wish to share with us and others who visit the web site.
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