Municipalities maintain operating funding

The Provincial Government has upheld the 2015 Municipal Fiscal Framework commitment of maintaining municipal operating grants and followed through on the third of three planned increases to the provincial gas tax transfer and HST rebate.

Last month’s pre-budget announcement showed that the Department of Municipal Affairs and Environment is motivated to leverage as much federal infrastructure funding as possible. Karen Oldford, President of Municipalities Newfoundland and Labrador (MNL) says while funding ratios were changed, it was a necessary step to ensure that municipalities in this province receive all of the federal funding available to them.

“There is a historically high level of federal funding available to us right now and we have no idea when this kind of investment will be offered again. We also knew the province was in real danger of not coming up with its share of the federal/provincial infrastructure funding,” stated Oldford. “We don’t want to miss this window of opportunity so we supported the Department’s decision to change the multi-year capital works program and the cost sharing ratios which freed up enough provincial money to leverage these federal funds.” Oldford says she expects total municipal infrastructure spending will actually increase over the next few years as a result.

President Oldford said the decision to move roads to a 50/50 cost share ratio has caused serious concern for all communities and MNL is working with the Department of Municipal Affairs and Environment to find solutions to improve the cost-sharing ratio for roads. In the short term Oldford said municipalities will have opportunities to partner with the Department of Transportation and Works on road work in their areas. “Municipalities that have taken advantage of this partnership in the past have reported significant savings in the cost of road work.” Oldford said she also expects to see opportunities for this approach to expand in the future and municipalities can also lower their share by taking a regional approach. Meanwhile Oldford says MNL is working with the Department of Municipal Affairs and Environment on other means to improve the ratios for road work.

Oldford says as a province we have an emerging crisis in drinking water and waste water treatment that will require an investment of a billion dollars over the next decade. “Communities are doing the best they can but we don’t have that kind of money so we absolutely need federal funding.” Oldford also says that MNL felt prioritizing clean drinking water projects over roads is the right thing to do. “We wish we didn’t have to make those kinds of choices, but that’s the financial situation we all find ourselves in.”

Oldford said she is also pleased with the focus on regional cooperation and that encouraging regional cooperation on infrastructure is a necessary step towards a regional government structure that is required for most of the province. “Given what we know about demographics in rural Newfoundland and Labrador we believe regional government is the future of municipal services and democracy.”


About MNL
Municipalities Newfoundland & Labrador (MNL) was formed in 1951 as an umbrella organization mandated to represent and support local government in Newfoundland and Labrador. MNL represents the 276 incorporated municipalities in the province that service 89 per cent of the population and their more than 2,000 leaders.

Copyright © 2017 MNL, All rights reserved.
Municipalities Newfoundland and Labrador

Gail Woodfine – Communications and Public Relations
Tel: 709-753-6820 l Fax: 709-738-0071 l Toll Free: 1-800-440-6536
MNL mailing address is
460 Torbay Road, St. John’s, NL A1A 5J3