Financing considerations are inherent in the models outlined earlier in this section. A number of additional financing tools have been used more extensively in other jurisdictions, including:
• Tax Increment Financing: Special levies or the incremental increase on taxes or user charges are used to fund infrastructure investment.
• Value Captured Charges: Incremental revenue from a specific geographical site is relied upon as security for financing (incremental revenue associated with assessment growth).
• Revenue Bonds: Bonds are secured by a dedicated revenue stream (e.g., tolls, rentals, user charges, etc.). Revenue bonds reduce the reliance on general obligation debt, which has the benefit of not increasing the debt burdens on government or public-sector entities.
• Dedicated Taxes: New taxes, or portions of existing taxes, are earmarked for specific programs or initiatives. For example, the provincial and federal governments have committed to sharing portions of their respective gas taxes to support public transit and other critical public infrastructure.
The experience in Ontario with these financing tools has been fairly limited. For some of these tools, the statutory authority to utilize them is not currently in place. PIR will review and further explore these financing tools and their applicability to infrastructure renewal in Ontario.