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Courting cities, Ontario NDP touts steady supply of provincial cash

Andrea Horwath is wooing Ontario's cities with the promise of multi-year commitments of infrastructure cash – welcome words to municipal governments that have long complained they're left holding the bag for costly projects and ongoing maintenance their property taxes can't cover.

The party is pledging to hammer out a deal with cities that would set up a framework for annual infusions of infrastructure funding. There's no dollar figure yet – the Ontario NDP Leader's campaign says that depends on how talks go.

The proposal has precedence. An agreement between cities, the province and the federal government transfers funds from the gas tax toward cities, earmarked for infrastructure.

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But for the most part, capital funding comes from higher levels of government in itemized instalments. It allows them more flexibility in choosing where and when they spend (and also makes for better press releases and photo opportunities) to dole out infrastructure cash on a per-project basis. But local governments argue it often leaves them scrambling for cash or having trouble planning budgets more than a year or so into the future.

This promise comes in addition to several other goodies thrown towards voter-rich urban centres. Ms. Horwath has also pledged to shoulder half the operating subsidy for public transit (in Toronto, this could get as high as $300-million annually – higher if planned subway expansions eventually materialize). She has promised $70-million a year over three years for the "roads-and-bridges" variety of municipal infrastructure, and $125-million a year for two years toward strained daycare programs.

The promised financial assistance is targeted but fairly directive-free. So far the only conditions she's tied to it are a freezing of user fees, although it's likely that an ongoing infrastructure-funding agreement would exact matching commitments from cities, as well.

The message to cities is clear, and it's the same one she's spent the week selling to squeezed blue-collar workers: Ms. Horwath feels your pain.

"I used to be a city councillor in Hamilton," she said in Ottawa Wednesday. "I was there when the downloading happened [under Mike Harris] I know very well how difficult it is for municipalities to deal with paying for provincial programs."

On the one hand, it's a move to differentiate herself from the Progressive Conservatives, who many voters (and urbanites, especially) still associate with the downloading of costs from Mr. Harris's time in government.

On the other, she's trying to one-up the Liberal Party, under whose government the gas tax agreement originated and that has already pledged to continue a scheduled "uploading" of program funding back onto the province's coffers.

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And there's no question municipal politicians of all stripes have expressed a desire for more – and more consistent – cash.

It was a common complaint of former Toronto mayor David Miller's administration that constructing the city's budget would be far easier if the province would be good enough to pony up some more funds for infrastructure, or at least commit to a long-term funding schedule so financial planners had something to go by.

Toronto Mayor Rob Ford swept into office promising, among other things, to balance the city's books without running to Queen's Park for a handout. "The city has a spending problem," he was fond of saying, "not a revenue problem."

But as the provincial campaign drew closer and he found himself facing a $774-million budget shortfall, Mr. Ford was in the Premier's office, cap in hand. (Ms. Horwath met with the Toronto Mayor one-on-one shortly before the campaign began. Their talks were cordial, her aides say, although she was taken aback by the media frenzy swarming him at every opportunity.) "We will not download services," Ms. Horwath has said multiple times this campaign.

"But we'll go further. … We recognize municipalities have a very limited tax base in terms of their ability to raise money: All their tax base comes from user fees and property taxes; and people are having a hard time just covering the cost of those kinds of fees right now."

Toronto Transit Commission chair Karen Stintz, a centre-right councillor who usually countered former mayor Mr. Miller's policies on council, certainly wouldn't say no to more provincial assistance. "It would be great" for the province to help with transit operations; she'd like some help with a $1.5-billion shortfall in capital spending that's needed just to keep the system in a state of decent repair.

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Too often, she noted, provincial governments are enamoured with the allure of promising new projects and expanded transit; far less so with the more prosaic issue of paying to for operation and upkeep of what's already there.

"The property tax base can't pay for the TTC," Ms. Stintz said. "There's still a need that's not being addressed."

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