Canadian Shipper


Breaking News: Federal budget highlights infrastructure spending, dedicated gas tax fund

OTTAWA, Ont.–The 2014 Economic Action Plan (Federal Budget), officially released today at 4 p.m. by Finance Minister Jim Flaherty, offers dedicated funds for infrastructure, public private partnerships and gas taxes.

Starting in 2014–15, the $53-billion Building Canada plan will provide:

• $21.8 billion over 10 years through the Gas Tax Fund, including an

additional $1.8 billion in support over 10 years through the indexation

of payments at 2 per cent per year.

• $10.4 billion over 10 years under the incremental Goods and Services

Tax Rebate for Municipalities.

• $14 billion over 10 years for a new Building Canada Fund to support

major economic projects that have a national, regional and

local significance. The Government continues to consult with the

Federation of Canadian Municipalities and other stakeholders to finalize

the parameters of the new Building Canada Fund and is committed to

launching the new Fund by March 31, 2014, said the EAP.

• $1.25 billion over five years will be provied for a renewed P3 Canada Fund to continue

supporting innovative ways to build infrastructure projects through

public-private partnerships (P3s).

• $6 billion in federal support to provinces, territories and municipalities

under current infrastructure programs in 2014–15 and beyond.

• $155 million over 10 years for First Nations on-reserve infrastructure

from the new Building Canada Fund, in addition to allocations from

the Gas Tax Fund.

This funding “will support innovative approaches to building infrastructure projects faster, for example through P3s, which provide better value for money and improve the delivery of much-needed infrastructure projects,” said the Plan.

Economic Action Plan 2014 also proposes measures to ensure the construction of the new St. Lawrence bridge by 2018, including $165 million over two years on a cash basis for procurement and project delivery activities for the new bridge for the St. Lawrence. The activities will include engineering studies, property acquisition and utility relocation, and project management functions. The procurement process to select a private sector concessionaire will be launched in 2014.

The Windsor-Detroit trade corridor is considered the most important international land crossing in North America, handling 30 per cent of Canada-U.S. trade carried by truck. In 2012, approximately 2.5 million trucks carrying over $100 billion in trade used this corridor. The Government “has been working towards building a new international crossing between Windsor, Ontario and Detroit, Michigan, in recognition that an efficient and secure corridor is essential to the competitiveness of the manufacturing sector, and Canada’s economy more broadly,” said the EAP.

The Government “has made progress in advancing the construction of the new bridge, including concluding a governance agreement with the State of Michigan and obtaining a Presidential Permit from the United States Government to proceed with construction on the American side of the crossing.”

It is providing $631 million over two years on a cash basis to advance the construction of the new crossing, of which Economic Action Plan 2014 proposes to provide $470 million over two years on a cash basis to support necessary procurement and project delivery activities. This project will be undertaken as a public-private partnership, said the EAP.