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Get feds out of local infrastructure

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Plessis Road at Dugald was closed this summer for the construction of an underpass.


Plessis Road at Dugald was closed this summer for the construction of an underpass. Photo Store

Can federal, provincial and municipal governments put aside their differences to fix Canada's crumbling infrastructure? Looking at projects across the country where all three levels of government co-operate, the answer is no. Winnipeg's Plessis Road underpass project provides a perfect example of how differing interests prevent governments from all just getting along. Rather than increasing the federal government's role in local infrastructure, we should cut the federal government out of the loop altogether.

The federal and provincial governments pledged to fund one-third of the Plessis Road project. Recently, the city discovered the federal and provincial governments have found many related expenses ineligible for funding. Consequently, the $25-million contributions the city was counting on from each will in fact be $22.2 million. That will leave the city on the hook for $30.6 million, while upper levels of government will both get equal prominence at the ribbon-cutting photo op (complete with Canada's Economic Action Plan and Manitoba Infrastructure and Transportation signs). The feds and the province want to appear to be equal partners without paying an equal share.

Federal, provincial and municipal politicians may also prioritize different construction procedures based on their own interests.

For instance, as a condition for receiving federal funding, the project needs to be completed by March 2015. While some local residents, including provincial NDP MLA Jim Maloway, would like to see a temporary bypass built to ease traffic during construction, that would result in an 18-month delay. Rather than simply costing $10 million for additional construction, the city would have to forgo $22.2 million in federal funding.

The Plessis Road closure will hurt local business and irritate many residents. It will also create traffic congestion throughout the area, since 16,000 cars will have to find a new route during the closure.

It is entirely possible local voters would rather keep the road open during construction and allow the project to go on for a longer period of time. However, the federal government desperately wants to dole out infrastructure dollars to demonstrate to nationwide voters it is delivering on a commitment to fixing Canada's infrastructure. While local councillors and MLAs might get upset at the immediate impact of the closure, the federal transportation minister doesn't have time for such details.

Provincial politicians also have their own considerations. At the moment, the provincial government is under fire for raising the provincial sales tax. In order to appease voter outrage, they are now pledging to dedicate some of the PST increase to infrastructure. Like their federal counterparts, that means they need to see projects completed. Since not only local, but province-wide voters have their eyes on the provincial government, they need to get such projects done without worrying about how the project impacts the local government and voters. Funding infrastructure has become a face-saving exercise, so allocating money is the first consideration.

As much as we'd like to imagine politicians at different levels can come together to fix Canada's infrastructure, there is no reason to think they can do so efficiently. Nearly three decades of disagreements over funding Toronto's transportation system, and the corruption-laden, billion-dollar Quebec Pipeline Renewal Program are but two other examples of how accountability breaks down and indecision flourishes when three levels of government are involved in a single project or policy area.

The ideal solution is to allocate a larger share of tax dollars to municipalities while eliminating direct spending by upper levels of government. A logical starting point is to allocate all federal gas-tax dollars to municipalities. Devolving taxing power from the province to the city while eliminating the provincial role in local infrastructure should be the next step.

City councils are better placed to make local infrastructure decisions than the Prime Minister's Office or the premier's office. It's time to trust our local politicians more, and federal and provincial politicians a little less.

Steve Lafleur is a policy analyst with the Frontier Centre for Public Policy.

Republished from the Winnipeg Free Press print edition November 26, 2013 A9

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