Municipal High Wire Act: Growth and Infrastructure

Recently a news item mentioned that Saskatchewan's growth has not kept pace with our neighbours to the east and west of us. I can't help but wonder whether our infrastructure problems are starting to affect our ability to grow.

There is pressure to grow:

• the economy is growing,
• jobs are left unfilled,
• housing is needed,
• infrastructure needs replacing, and
• more. ...

We are growing! The main purpose of municipalities is the provision and maintenance of a range of infrastructure. Infrastructure such as:

• water to wash in and flush the toilet,
• sewage to keep our home and community clean and healthy,
• roadways, preferably with a hard surface such as asphalt, which are easily kept clean and drain easily for health purposes and for business productivity reasons,
• gutters so water can drain away preventing flooding,
• sidewalks to separate pedestrians from motor vehicles thus keeping people safe and health care costs down,
• cultural facilities to allow people to express themselves, pursue excellence, and be inspired,
• recreation facilities enabling people to express themselves, pursue excellence, be inspired,
• green space for public gatherings, to play, to relax and to contemplate,

From a business perspective this is the 'goods' a municipality provides. However, municipalities are not like most businesses. Municipalities have an obligation to provide infrastructure to ensure businesses can prosper and so residents of all ages can flourish. As a result there are challenges for Kindersley as we grow:

• an infrastructure deficit, or asset cost recovery of $40 million;
• the West Central Community Centre Phase 2,
• increased capacity for the water treatment plant,
• increased capacity for waste water system,
• increased capacity for storm water system,
• infrastructure deficit,
• rehabilitation of our current landfill site, and a
• new regional landfill site.

At this time I am very concerned about our financial capacity to effectively deliver good infrastructure for Kindersley. I am not in favour of municipalities having the ability to go into debt because our revenue is very limited. The Sask Party government has significantly increased funding to municipalities through increased sharing of the gas tax. However, this increased funding does not meet our needs nor the needs of many other communities.

For the budget year of 2012-2013 the government of Alberta set aside in their Alberta Municipal Infrastructure Fund $1.8345 billion for infrastructure development. Our government's program was discontinued in 2012 and when it did operate it was a program allowing municipalities to have low interest loans to build infrastructure. According to the SK Municipal Board, the regulatory body that determines what communities can borrow, Kindersley may not have qualified to borrow money to build much needed infrastructure.

We are in a good situation to understand our infrastructure through our increased asset management work. Administration is currently working to integrate all of our infrastructure into a:

• long-term financial plan,
• long-term infrastructure plan,
• asset management plan,
• our Official Community Plan, and
• Strategic Plan.

We are doing this work so we can ensure Kindersley's vibrancy as a community as we grow.

A possible solution addressing our infrastructure and financial constraints, and please hear me say I am thinking out loud, is to:

• P3 partners for financing and construction similar to many communities across Canada
• this solution would more or less be user pay meaning that as a generation uses the infrastructure they pay for it;
• however, we have an infrastructure deficit because inadequate investment occurred for more than 20 years.
• the problem with P3 is that there is usually a premium with this option,
• and how does it address the lack of infrastructure investment from the late 1980's to the mid-2000s?
• A tax levy, based on infrastructure risk analysis and integrated planning, to effectively address the infrastructure deficit and build for the future.
• ???
• What is your solution?

It is important to state another item: I have been told that the other levels of government are hesitant to provide funding for the West Central Community Centre Phase 2; there may be funding but it will not be significant. For a community to flourish it needs more than flowing water and flushed toilets. For businesses to prosper, their owners and employees must also flourish.

Finally, municipalities are responsible for about 66% of Canada's infrastructure. However, during the period in which most of our infrastructure was built, in the 1950s -1970s, municipalities were responsible for 50% of the infrastructure with 4% of GDP used to build it. From the 1980's through the mid-2000s there was little infrastructure construction and only 2% of GDP used to build and maintain it. Today approximately 3% of GDP is used to maintain and build new infrastructure AND address the infrastructure deficit.

Infrastructure, both hard, such as water and sewage, and soft, like culture and recreation facilities, are needed if we are to ensure healthy growth.

Surgite!