Canadian Underwriter

Ontario government beefs up investment in critical infrastructure

December 18, 2012   by Canadian Underwriter

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The Ontario government is increasing support for critical road, bridge, water and wastewater projects under its Municipal Infrastructure Strategy, a move sure to garner support from insurance industry and municipal representatives alike.

The increased investment — up substantially from the $51 million announced in August to almost $90 million — is meant to help more municipalities maintain and repair their critical infrastructure, notes a press release issued Monday by Ontario’s Ministry of Infrastructure.

The funding will be made available over two years in 2013-2014 and 2014-2015. Projects must be completed by December 31, 2014.

The Insurance Bureau of Canada (IBC) welcomes the announcement.

“Our infrastructure will continue to face challenges due to the effects and impact of severe weather,” Ralph Palumbo, IBC’s vice president for Ontario, says in a statement. “The Canadian insurance industry has seen substantial increases in property claims costs, partly as a result of infrastructure that was never designed to cope with the weather trends we are seeing today, and we fully support sustained investments that help build resilient communities and a secure economy,” Palumbo adds.

Ontario’s infrastructure ministry notes that project funding will cover 90%, or $2 million, of total project costs — whichever is lower. Municipalities’ applications for funding, to be received online by Jan. 9, 2013, must show how projects fit within a comprehensive asset management plan.

“This will help ensure that limited resources are directed to the most critical needs,” notes information on the Municipal Infrastructure Strategy.

The Ontario government said in August it is also providing as much as $9 million to small and northern municipalities to help prepare asset management plans, the ministry reports. This can help municipalities make smart, long-term planning decisions about building, operating, maintaining, renewing and replacing infrastructure.

“The province recognizes that small municipalities may have limited financial capacity to undertake asset management planning,” notes the strategy document. “As communities develop and improve asset management plans, it is important to integrate planning for all infrastructure assets,” it adds.

“Our government was determined to strengthen our support for municipalities to take care of their most critical infrastructure priorities,” infrastructure minister Bob Chiarelli says. “We know that every dollar invested in infrastructure is a dollar invested in quality of life and will boost local economies and create jobs.”

IBC cites Telling the Weather Story, a research paper from Dr. Gordon McBean that was released earlier this year. Among other things, the paper outlines how severe weather is a factor in the increasing damages to personal and commercial properties being witnessed in many parts of Canada.

“It is imperative we continue to see momentum on this file and that we work together — governments, industry, communities and individuals — to recognize the weather risks we are facing and to enter discussions about how to reduce their effects on our lives and the communities we live in,” Palumbo says.

The call to beef up infrastructure funding extends beyond Ontario’s borders. Last month, the Federation of Canadian Municipalities called on the federal government to create a 20-year plan and to increase municipal infrastructure investments from $3.25 billion annually to $5.75 billion to address aging infrastructure across the country. Ottawa’s Building Canada plan for infrastructure funding ends in 2014. 

Also in November, business, local governments and professional organizations that make up the Municipal Infrastructure Forum noted that more than half of all municipal roads are in need of immediate repair, while one in every four wastewater treatment plants requires major upgrades to meet new federal wastewater regulations. 

“We’re calling on the federal government to build on its historic contributions to municipal infrastructure and ensure its new long-term infrastructure plan is reliable, sustainable and has the flexibility to address local needs,” Carol Wilding, president and CEO of the Toronto Board of Trade, said at the time.

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