Much of the discussion in this paper clearly centers around the important question of "who is to pay" for the needed infrastructure in our cities. Is it the current citizens of the city or should future citizens also contribute? Should current residents of the city-region be paying? Should all taxpayers in the province and right across the country be required to chip in through significant and ongoing support from provincial and federal governments? Or, should the costs land on everyone and anyone who uses the services and infrastructure of western Canada's cities to earn a living, recreate, or shop, regardless of where they live? While one could easily answer "yes" to each of these questions, it is arguably the latter approach that appears to be the most equitable. And this, of course, necessitates a focus on those options and alternatives that will allow all those who draw a benefit from well-financed cities with quality infrastructure to pay their fair share.
The options here are very wide ranging and present a lot of ideas for local governments to pursue. But their federal and provincial counterparts must resist any notion that city governments can tackle the issue alone. First, it is unlikely that long-term and sustainable solutions to the infrastructure issue can be met by cities acting under the limited resources of the current legislative and fiscal regime. Traditional sources of capital financing do not adequately address all the significant drivers of infrastructure deficits. Second, innovating with these sources may help, but this may require provincial and federal approval, and they too may be insufficient to address some of the roots of the problem.
The notion of systemic reform, however, presents opportunities to implement strategies that can counteract current incentives, provide better revenue-generating capacity, allow cities to recoup the costs of providing services to outsiders, produce savings in current operations, and give cities the ability to capture a portion of the economic activity occurring in their boundaries. Much of the municipal infrastructure issue is directly related to a sustained and significant trend toward increased urbanization in Canada. This has resulted in substantial urban population and economic growth, but cities are unable to tap that growth sufficiently to respond to it. This, coupled with the sheer size of the infrastructure problem, indicates that all governments need to break out of the status quo. That implies a number of things, from attracting private participation in infrastructure to assessing virtually all aspects of municipal operations, including which services to provide and how to price and even deliver them.
At the same time, the final message of this study should not be reduced to simply finding more funds for municipal infrastructure - whether that be new money as a result of a different tax system or saved money that results from competitive service delivery. Money alone will not resolve the problem in a sustainable fashion. In other words, money is a necessary condition, but it may not be a sufficient condition.
This study stresses that moving forward on the municipal infrastructure issue requires a hard look at a mix of options that specifically target the main drivers of the problem. Simply put, finding new financing sources to address the shortfall in infrastructure funding is a primary goal, but a complementary objective is to also address the full range of non-financial options as well, whether that be increasing our understanding of infrastructure issues broadly speaking, conducting research and analysis, developing inventories of municipal assets, surveying their condition and the investment needed, and employing better and more comprehensive infrastructure governance and asset management techniques in general. Reversing incentives that artificially increase the demand for infrastructure and limiting the effects of urban sprawl and suburban and metro-adjacent development are critical. The importance of these goals, whether financial or non-financial, should not be underestimated.
Increasing understanding of infrastructure is part of the solution, and this also links to the current state of public opinion on the issue, which has no small impact on any attempt at systemic reform. Governments, whether federal, provincial, or municipal, face a significant hurdle in implementing some of the alternatives. For example, the public is very cautious about any new municipal tax tools or across the board increases in user fees. To move forward, the current lack of understanding about the importance of public infrastructure to Canada' economic and social well-being must be addressed. Canadians do not understand the connection between infrastructure and the future economic prosperity needed to sustain the nation's social programs, and as such, they are less likely to flag infrastructure as a high priority.
This is no time to be timid. Even if Canadians remain somewhat shy or skeptical of the alternatives needed to advance long-term and sustainable solutions, the journey down that road must begin. If we fail here, the road travelled in the future will only get rougher. Eventually, Canadians will find the road so littered with potholes that it is impassable. And, that is one option none of us should pursue.