HomeMy WebLinkAboutCS 06-10
48
City o~ Report To
Council
PICKERING Report Number: CS 06-10
Date: March 8, 2010
From: Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject: Federal Gas Tax Revenues Amending Agreement
Recommendation:
1. That Report CS 06-10 from the Director, Corporate Services & Treasurer be
received:
2. That the Mayor and City Clerk be authorized to execute the Amending Municipal
Funding Agreement and any subsequent agreements required for the Transfer
of Federal Gas Tax Revenues Under the New Deal for Cities and Communities
with the Association of Municipalities of Ontario in order to facilitate the transfer
of gas tax revenues from the Government of Canada to the City of Pickering;
3. That the Director, Corporate Services & Treasurer be authorized to submit any
required expenditure or compliance reports, forms, statements, including
authorization of other documentation or agreements required of the City;
4. That the attached By-law be read three times and passed; and,
5. That the appropriate officials of the City of Pickering be authorized to take the
necessary actions to give effect thereto.
Executive Summary: The Association of Municipalities of Ontario (AMO) is
administering the gas tax funding program on behalf of the Federal Government for all
municipalities in Ontario with the exception of the City of Toronto. As administrator,
AMO has provided municipalities with an Amending Municipal Funding Agreement that
implements the main elements of the agreement between the Government of Canada,
the Province of Ontario and AMO. The original agreement provided for the transfer of
funds for the period 2005-2009 during which time $7.1 million was transferred to the
City. The Amending Agreement covers the period 2010 to 2014 during which time it is
anticipated approximately $10.8 million will be transferred to the City.
Report CS 06-10 March 8, 2010
49
Subject: Federal Gas Tax Revenues Amending Agreement Page 2
Financial Implications: The City received $7.1 million over five years 2005-2009 on
a semi-annual basis. All monies must be expended on eligible infrastructure projects by
December 31, 2012. All monies from the extension period must be expended on
eligible infrastructure projects no later than December 31, 2016. In 2010 payment will
be made as soon as AMO receives the fully executive Amending Funding Agreement
and the By-law authorizing the agreement as provided for in the report and the
completion of the 2009 Gas Tax reporting requirements.
Schedule of Funding Payments
Year Jul November
2010 $1,347,215.33 $1,347,215.33
2011 1,347,215.33 1,347,215.33
2012 1,347,215.33 1,347,215.33
2013 1,347,215.33 1,347,215.33
The'City is required to submit an "Annual Expenditure Report", "Outcomes Report" and
Compliance Audit Report or Municipal Treasurer's Certificate by March 31 st each year,
following the municipal fiscal year to account for the funds received, expenditures made
and progress achieved on an annual basis.
Sustainability Implications: Continuation of this grant program contributes
significantly to the City's infrastructure and financial sustainability.
Background: In February 2005, the Federal Government announced that in 2005-
06 Canada's cities and communities would receive a share of the Federal gas tax
revenues for environmentally sustainable municipal infrastructure. On June 17, 2005, in
fulfillment of this budgetary commitment, the Governments of Canada and Ontario, and
AMO signed the Agreement for the Transfer of Federal Gas Tax Revenues under the
New Deal for Cities and Communities. This agreement provided a framework for the
transfer of gas tax funds to Ontario communities for investment in environmentally
sustainable infrastructure. Over $1.8 billion in funds flowed to Ontario's municipalities
over the next five years
Eligible Investments
This program is not application based, but allows municipalities to make investments
within the guidelines as established by the Federal Government. Environmentally
sustainable municipal infrastructure projects are eligible within one of the following
categories: public transit, water, waste water including storm water systems,
community energy systems, local roads bridges and tunnels. For local roads and
bridges projects, municipalities must submit in writing to AMO appropriate
documentation, prior to spending the funds, outlining the impact of such investments on
Report CS 06-10 March 8, 2010
Subject: Federal Gas Tax Revenues Amending Agreement Page 3 5
sustainability outcomes. Spending in other eligible project categories does not require
pre-approval.
Incremental Principle
A key condition of the agreement is that the funding either enabled a project's
implementation, enhanced its scope or accelerated its timing. This condition was
placed so that municipalities would not reduce,other infrastructure funding and not to
displace current capital. investments or use the funding to' reduce municipal taxes.
Senior. levels of government (Federal & Provincial) both recognize that there is an
"infrastructure deficit" and they want this program to help address this deficit.
Eligible Costs
The Municipal Funding Agreement permits incurred eligible costs after April 1, 2005 for
eligible projects that contribute to environmentally sustainable infrastructure. A full
discussion of eligible and ineligible costs can be found in Report CS 92-05.
The Federal Gas Tax Revenue Agreement is an important recognition by the Federal
Government of the challenges faced by municipalities in addressing infrastructure
needs. The intent of this program is -to provide Ontario municipalities with a source of
stable, predictable and long-term funding towards environmentally sustainable
municipal infrastructure projects which support environmental outcomes of cleaner air,
water and reduced greenhouse emissions.
Under the program's guidelines, the City was required to establish a Federal Gas Tax
Reserve Fund-for the purpose of "receipt, maintenance and disbursement of Federal
Gas Tax revenues". In addition, the City will be required to submit an "Annual
Expenditure Report",. "Outcomes Rep.ort" and Compliance Audit Report or Municipal
Treasurer's Certificate by March 31 s following the fiscal year to account for the funds
received, expenditures made and progress achieved on an annual basis.
Amending Agreement
The major components of the Amending Municipal Funding Agreement, for example
eligible project categories, eligible costs and expenditure reporting requirements, remain
the same. New in the extension, however is a change to the municipal audit
requirements: If Gas Tax Funds were not used during the municipal fiscal year, the
Treasurer is now required to submit a signed Treasurer's Certificate to that effect.
Attachment:
1. By-law to Enter into an Amending Municipal Funding Agreement between AMO
and the City of Pickering for the Transfer of Federal Gas Tax Revenues under
the New Deal for Cities and Communities
Reps t CS 06-10 March 8, 2010
Subject: Federal Gas Tax Revenues Amending Agreement Page 4
Prepared By: Approved / Endorsed By:
Caryn Kong Gillis A. Paterson
Senior Financial Analyst - Capital Director, Corporate Services & Treasurer
& Debt Management
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City Council
T,,h maw Quinn D , CMM III
Chief Administrative Officer
THE CORPORATION OF THE CITY OF PICKERING 52
BY-LAW NO. /10
Being a By-law to authorize the execution of
an Amending Municipal Funding Agreement
for the Transfer of Federal Gas Tax Revenues
WHEREAS in order to facilitate the transfer of gas tax revenues from the Government of
Canada to the City of Pickering it is necessary to execute an Amending Municipal
Funding Agreement.
WHEREAS the City of Pickering enacted By-law No. 6608/05 to provide for the
execution of the original funding agreement.
WHEREAS the City of Pickering has established a Federal Gas Tax Reserve Fund
under By-law No. 6609/05 and met all other requirements of this program.
NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE CITY OF
PICKERING HEREBY ENACTS AS FOLLOWS:
1. The Mayor and Clerk are hereby authorized to execute the Amending Municipal
Funding Agreement and any subsequent agreements for the Transfer of Federal
Gas Tax Revenues with the Association of Municipalities of Ontario.
BY-LAW read a first, second and third time and finally passed this 8t" day of March,
2010.
David Ryan, Mayor
Debbie Shields, City Clerk