After burning up 3,000 kilometers on western Canada’s highways, it feels good to be back in the saddle at Canada West Foundation’s offices in Calgary.
In Saskatoon, I took part in a special Municipal Infrastructure Forum hosted by the Federation of Canadian Municipalities (FCM) following their 75th annual conference. In Edmonton, I made two presentations on infrastructure innovation and LetsTOC. The first was at the 125th annual conference of the Canadian Society of Civil Engineers (CSCE). The second was to members of the Economics Society of Northern Alberta (ESNA).
Infrastructure Dominates the Conversation
The degree to which infrastructure dominates the conversation across the municipal policy community—and those that plug into it—is amazing. Everyone is abuzz about infrastructure. Much of the collective hum is being fuelled by developments in Ottawa around the Building Canada Fund, which is set to expire in 2014.
This program—worth almost $10 billion—was established in 2007 to help build critical infrastructure across the country. The 2009 federal “stimulus” program—Canada’s Economic Action Plan—topped up the original funding to deal with the recession, stimulate aggregate demand, and protect and create jobs.
The Honourable Denis Lebel, federal Minister of Transport, Infrastructure, and Communities, has been tasked with crafting a new national long-term infrastructure plan to succeed the Building Canada Fund. Those “in the know” affectionately dub the effort as the new “LTIP” (Long Term Infrastructure Plan). It makes sense, then, that the municipal and infrastructure policy community is busying itself with how that plan should look, what it should involve, and what it should do.
I confess that I haven’t given a lot of thought to all the various components that might go into this “LTIP”. But, there are at least two broad directions that I think ought to be seriously considered.
Facilitate Local Control
First, any new federal funding program should allow for a good measure of local control over which projects are funded and how they proceed. When it comes to provincial and federal support for municipal capital, most of it has traditionally been “conditional”. Whether or not the money is available depends on whether a municipality meets the “conditions” of the grant program. Usually, this means that the municipality has to build the “right” project.
Bob Linner, a member of the CWF Board of Directors and former city manager of Regina, told me once about a funding program made available for local ice arenas. While other infrastructure was a much higher priority and desperately needed support, Regina went ahead and made the arena investments. Why? The money was available. In this case, funding skewed local infrastructure investment away from priority areas.
Canada’s cities, towns, and villages know what they need and know what their citizens want, certainly more so than public servants holed up in Ottawa. Municipalities across Canada invest thousands upon thousands of hours assessing needs and developing capital plans and budgets. It makes little sense to simply ignore all of this.
Michael Atkinson is president of the Canadian Construction Association (CCA). At the infrastructure forum in Saskatoon, he argued that the owners and operators of the infrastructure—the “creators and caretakers” of it—should make the essential decisions on where investments are needed. Michael’s right.
Reward Innovation
I’m not entirely opposed to the concept of conditionality. Federal and provincial governments, too, have a stake in municipal infrastructure investments. But, I think we could use conditionality in different and much more creative ways. Rather than trying to incent particular projects or target certain types of infrastructure, why not make some funding conditional on innovation? Why not use some of the funding to facilitate, stimulate, incent, reward, apply, and test out new infrastructure solutions?
Found a new way to finance or fund a project? Here’s some money to help. Uncovered a better and more cost-effective design for a bridge or overpass? Here’s a few dollars to move the thing ahead. Got some new technology for water treatment that lowers operating costs? Well, here’s a grant.
Carving off a special pool of funding that will go only to projects that are creative, fresh, new, and innovative will help stimulate creative problem-solving, incent critical thinking, and get our collective infrastructure imaginations and juices flowing. I don’t know if Michael would agree with me on this point, but I do think there’s a lot of merit in the idea. (All of this is explored in more detail in a Canada West Foundation research study called New Tools for New Times, pages 109-111.)
A lot of government policies and programs are promoted and publicized with a “hook” or “angle.” For the Building Canada Fund, one hook was “green” infrastructure and the “Green Municipal Fund” managed by FCM. Another hook was public transit. When it comes to conditionality, the choices are endless. Why not a focus on innovation?
The Answer
Four reasons. First, the infrastructure challenge is immense. Billions upon billions of dollars are required to upgrade and renew the nation’s core economic assets—from water mains to wastewater treatment plants, from roads and sidewalks to bridges and overpasses. Then, there are the nation’s social assets as well—hospitals, schools, recreation centres, libraries, museums, and sports facilities. I believe that the sheer size of the challenge is outside the scope of “business-as-usual”.
Second, as Communities of Tomorrow president John Lee is quick to point out, a big part of the solution has to be found in making infrastructure renewal, rehabilitation, and replacement more cost-effective, longer-lasting, and more efficient. Embracing innovation in financing, funding, and delivery of infrastructure, and finding and applying new technologies and approaches will allow the nation to lay down more infrastructure with the same dollars.
Third, innovation will open up opportunities to export our knowledge to countries around the world that are also facing the complex and costly task of overhauling and replacing their public infrastructure. At the Economic Development Association’s recent gathering in Kananaskis, Alberta, John was clear about the opportunities. “If something can be made to work in Saskatchewan, given our cold weather and harsh climate, well, it can work anywhere in the world.” Bang on, John.
Finally, rewarding innovation builds on innovative technologies and successes that are already gathering steam. The list on our website is evidence enough of that.
An Important Federal Role
In April, I trekked out to Ottawa to meet with the Steering Committee at Infrastructure Canada that is guiding the development of the new “LTIP”. They were interested in my thoughts on alternative financing for infrastructure, particularly user pay approaches, but also things like infrastructure banks and tax incremental financing. At the end of my talk, I encouraged the committee to consider three things in any new LTIP:
- Establish a set of special grants and capital transfers that will incent innovative approaches to financing, funding, and delivery of infrastructure.
- Make available financial support for research and development of new approaches and technologies for infrastructure, such as Saskatoon’s “Green Streets” initiative or Regina’s “End-to-End” water service connection replacement.
- Make sure the support is practical, and not theoretical. Help support pilot projects and demonstrations that will prove-out new technologies, using our municipalities as “living labs”.
While there’s a lot more involved in crafting a broad national infrastructure strategy, I do think local control and a focus on innovation should be two guiding principles. What do you think? Am I on-base or completely off-base?
*This article was also featured in the July 4, 2012 Edition of the CCA Weekly
By: Casey Vander Ploeg, Senior Policy Analyst