Last week Ontario's Finance Minister, Rod Phillips released Ontario's 2020 budget. The budget is part of Ontario's COVID-19 health and economic response plan and includes many measures targeted specifically at economic recovery from the effects of the pandemic.
JD Supra states that the Budget makes it clear that the follow-on economic effects of near-term spending on infrastructure by the government is a core element of the province's recovery plan. The Budget allocates significant funds to infrastructure spending and provides for investments in transit, highways, schools, hospitals and broadband over the next 10 years. This will total C$142.9 billion, including C$13.6 billion in 2020-21 alone.
Broadband infrastructure includes the following:
- Additional investments of over C$680 million over the next four years (part of Ontario's Up to Speed Plan)
- Additional C$150 million for the Improving Connectivity for Ontario (ICON) program
- Address such issues as broadband and cellular services in Ontario by expanding broadband and cellular infrastructure capabilities
Transit infrastructure includes the following:
- C$142.9 billion infrastructure allocation to transit
- Part of this allocation includes C$28.5 billion for the province's subway plan
- Federal government will fund at least 40 per cent of the C$28.5 billion total
- Commitment to current projects such as the Hurontario Light Rail Transit Project and the GO Rail Expansion program
- Provide C$1 billion in funding for transportation and transit projects in the City of Hamilton
Highway, road and bridge infrastructure includes:
- Various expansion and rehabilitation projects across Ontario
- C$22 billion allocated over 10 years to expand and repair Ontario's highways and bridges (C$2.6 billion in 2020-21)
- Expansion projects on parts of Highway 3, Highway 17 and Highway 401
- Accelerate provincial highway construction projects and transit-oriented communities including affordable housing
- Bradford Bypass will connect Highway 400 and Highway 404
- GTA West corridor will include a new four-to-six lane 400 series highway and transit corridor across York, Peel and Halton regions
Transit oriented community infrastructure will include working with the City of Toronto and York Region to support the delivery of the Transit Oriented Communities program across the priority subway projects and other provincial transit projects.
Health infrastructure will include:
- Measures targeted to the COVID-19 pandemic
- Invest more thatn C$18 billion in capital grants over 10 years to build new and expanded hospital infrastructure
- Address urgent upgrades
- Repairs and maintenance to help modernize hospitals across Ontario
- Investing C$175 million in 2020-21 using its Health Infrastructure Renewal Funds for repairs and maintenance projects in 129 hospitals across Ontario
- C$50 million of this funding for facility maintenance including upgrading HVAC systems, as well as infection prevention and control measures
- A material portion of Ontario's new long term care bed capacity will be provided through Ontario's new Accelerated Build Pilot Program for development and construction of four new long-term care homes in Mississauga, Ajax and Toronto by the end of 2021
Education infrastructure will include:
- Funds allocated to the education sector related to COVID-19 safety
- Investments of C$13 billion in capital grants over 10 years to build new schools and renew existing schools across Ontario
- Provide C$1.4 billion in 2020-21 for facility repair and renewal
- Provide C$50 million in one-time funding for improved ventilation, air quality and HVAC system works in schools
- Provide C$466 million over three years in capital grants to support colleges and universities with maintenance, repairs and upgrades
- Modernization of classrooms
- Upgrading technology
- Improving environmental sustainability
As far as electricity and renewables, the burden of electricity rates on Ontario's industrial and commercial sectors will be eased and certain renewable power costs from the ratepayer will go to the taxpayer. Ontario expects electricity rates for industrial and commercial employers to reduce by an estimated 8.05 and 14.321 cents per kilowatt hour on average.
Going forward, these rate reductions will no doubt be an important factor influencing infrastructure-related investment decisions with the province.
The Budget will have the federal government partner with Ontario in achieving many of the infrastructure related goals.
As part of the province's COVID-19 recovery plan, the Budget shows the government's continued commitment to support both new and ongoing infrastructure projects. This will help our recover, and fuel jobs and growth throughout the construction, maintenance and development sectors.
The government is committed in its plans for recovery from the COVID-19 pandemic and will require long-term funding solutions from other levels of government and the private sector.
Editor's note: This is, indeed, a confusing time for the construction industry. DataBid is working tirelessly to report and distill the news that can help you and your company make the right decisions and keep you up to date on the constant changes as they are made. We hope our coverage brings some clarity amid all the confusion.