Ottawa is rushing to launch its massive second phase of infrastructure spending this fall but is facing concern from municipal leaders that housing money will be squeezed by other federal priorities.
Canada's big-city mayors are gathering in Toronto on Friday to highlight their worry that Ottawa is preparing to launch a major 10-year-infrastructure program before a promised national housing strategy is in place.
At issue is how the federal Liberals will define social infrastructure, a broad category that the government said will receive $20-billion over the next decade. The category will include spending on affordable housing, but it will also fund other areas such as child care and cultural and recreational infrastructure.
Toronto Mayor John Tory and other big-city mayors will announce on Friday that they are calling on Ottawa to devote $12.6-billion of the $20-billion fund to address what they say is a national crisis in affordable housing.
Edmonton Mayor Don Iveson, who chairs the big-city mayors caucus of the Federation of Canadian Municipalities, said it's great that Ottawa is moving quickly to launch its second phase of infrastructure spending, but mayors fear that a decade of housing funds could be locked in at insufficient levels.
"Precisely because it's moving so fast, we are concerned about the window closing," he said in an interview Thursday.
Jean-Yves Duclos, the federal minister responsible for housing and social infrastructure, will speak at the mayors summit and The Globe and Mail has learned he will announce a new measure aimed at spurring the construction of 4,000 affordable rental housing units. Mr. Duclos has a mandate to develop a national housing strategy, but it is unclear when that plan will be ready or what it will include.
Officials at all three levels of government have confirmed that negotiations on Phase 2 of the social infrastructure fund are focused on how the $20-billion will be divided and what formulas will be used for spreading the money across the country.
The FCM is proposing that the formula for federal housing money should be based on factors such as local affordable housing demand and homelessness rates.
Federal officials confirmed to The Globe that the launch of Phase 2 is not considered part of the budget process, meaning it will be launched well before the 2017 budget and likely in the current calendar year. Consultations on this phase officially closed Sept. 15.
The city facing the biggest bill to fix its crumbling public housing is Toronto, which needs more than $1.6-billion from Ontario and Ottawa – $864-million from each – to continue a 10-year rehabilitation plan. Toronto is already spending $864-million of its own money. If the rest does not start to flow soon, Toronto officials say, up to 4,000 units owned by the city's Toronto Community Housing Corp. could be added to hundreds already condemned and left uninhabitable by next year.
"We're just saying we need other people to come to the table, the other governments, to help us with this, which is a problem affecting our most vulnerable people," Mr. Tory said at a news conference on Thursday after meetings with Vancouver Mayor Gregor Robertson.
The Liberal government's 2016 budget announced $120-billion for infrastructure over 10 years. The money is divided equally between green infrastructure, transit and social infrastructure. About $12-billion of the $120-billion has already been made available through what the government called Phase 1, which focused on repairing existing infrastructure and planning work for the much larger projects that will be part of the second phase.
The second phase is expected to fund larger new projects, such as major expansions of public transit systems.
Ontario Infrastructure Minister Bob Chiarelli said the talks among provinces, municipalities and Ottawa are focused on the creation of formulas that will provide predictable federal funding for housing, rather than a "free-for-all" competition among municipalities. He said one option is to provide base funding to municipalities based on population with an additional formula that is based on need.
"There is a consensus that we really want Phase 2 to roll out very quickly on the heels of Phase 1," he said in an interview.