CONFIDENTIAL

Ontario Community Infrastructure Fund

2017 AMCTO Municipal Finance Forum

Ministry of Infrastructure

12/01/2017

Overview

• The Ontario Community Infrastructure Fund provides funding to support critical

infrastructure projects and improve asset management planning in small, rural and

northern communities.

• The purpose of today’s presentation is to discuss:

1. Expansion of the Fund

2. Formula component (eligibility, formula design, expenditures, new portal)

3. Top-up application component (eligibility, assessment process)

4. Linkage to asset management planning

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Expansion of the Fund

• In 2016, in response to consultation feedback and the progress municipalities have

made on asset management, the Province announced the expansion of the Fund.

• The Fund is increasing from $100-million per year up to $300-million per year by

2018-19, including:

– Increased formula-based funding from $50-million per year to about $95-million

in 2017, $130-million in 2018 and $200-million per year by 2019.

– Increased application-based funding, from an intake of about $50-million in

2016 to intakes of $100-million per year in 2017 and thereafter.

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FORMULA COMPONENT

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Who is eligible?

• All small, rural and northern

municipalities.

• Local Services Boards (LSBs) who

own water / wastewater assets are also

eligible.

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How does the formula work?

• The formula is designed to recognize that communities have different infrastructure

needs and economic conditions.

• Recipients with more core infrastructure (roads, bridges water and wastewater)

and more challenging economic conditions (median household income and

weighted property assessment) receive proportionately more funding.

• Communities receive a minimum of $50,000 per year.

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More core infrastructure /

challenging economic conditions

Less core infrastructure/

challenging economic

conditions

Average

community

Less funding

Per $100,000 of core

infrastructure

More funding

Per $100,000 of core

infrastructure

What expenditures are eligible?

1. Capital construction of new core infrastructure to address an existing health/safety

issue

2. Capital maintenance for the renewal / rehabilitation / replacement of core

infrastructure

3. Debt-financing charges associated with the activities above, if started after Jan 1,

2017

4. Asset management planning, including training, software and some staff time

expenses

5. Certain operating expenses that enhance the performance of infrastructure

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How does funding for staff time work?• Municipalities may allocate up to 40% or $80,000 of their formula funding per year

(whichever is less) to hours worked by municipal staff responsible for asset

management.

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• Smaller communities should consider hiring

a shared resource to serve as their asset

manager.

• For example: two municipalities could

share an expert on a half-time basis.

• By collaborating, communities can share

best practices, learn from each other, and

improve their plans at a lower cost.

Municipality C

(contributes $30,000 / year

Full-time

Asset

Manager

Municipality B

(contributes

$30,000 / year)

Municipality A

(contributes $30,000/year)

Can recipients bank funding?• Recipients can accumulate funding for up to 5 years to undertake priority projects.

For example, a community receiving about $200,000/year could save for a $1M

project:

• Every year, each community will receive an updated notice so they can continue to

build the next three years of grants into their plans.

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2017 2018 2019 2020 2021

$200,000

$200,000

$200,000

$200,000

$200,000

$1M

project

When will the increased grants flow?

• Payment schedules vary based on allocation size:

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Size of Yearly Allocation Number of Payments Timing

Under $150,000 1 payment / year January – March

Between $150,000 and $1

million6 payments / year Regular payments

throughout the year starting

in JanuaryOver $1 million 12 payments / year

TOP-UP APPLICATION

COMPONENT

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Who is eligible for top-up funding?

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0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

Potential "top up"

Formula funding (2018 &2019 combined)

Ineligible Applicants

Town A Town B Town C Town D

● Communities receiving less than $2-million in formula funding over two years can

submit project proposals to bring their total OCIF funding up to $2-million.

● Communities successful under one intake cannot apply to the following intake.

What expenditures are eligible?

1. Capital construction of new core infrastructure to address an existing health/safety

issue

2. Capital maintenance for the renewal / rehabilitation / replacement of core

infrastructure

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How does the assessment process work?

• Assessment is based on the following criteria:

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Criteria Details

Criticality

(primary factor)

• Applications are assessed primarily on the expected health and/or

safety aspects of proposed projects.

• Communities with projects that are more critical are more likely to

be successful.

Funding Need • Based primarily on the cost of the proposed project per household,

as well as median household income and property assessment.

• Communities with greater financial need are more likely to be

successful.

Asset

Management Plan

completeness

• Each applicant’s asset management plan is assessed for

completeness in comparison to the elements in the Province’s

2012 Guide to Asset Management Plans.

Current Status of Top-up Funding

• In June 2017, the Province launched the 2017 intake under the Fund. The deadline

to apply was September 27th, 2017. More than 260 applications were received, with

about $100-million available.

• Applications are currently being reviewed. Decisions will be announced in early 2018.

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ASSET MANAGEMENT

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Linkage to Asset Management

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● OCIF support’s the Province’s Municipal Infrastructure Strategy. Launched in 2012,

the strategy focuses on asset management planning as a foundation for addressing

infrastructure challenges.

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Top-up Application Component Formula Component

• Proposed projects must be part of an

asset management plan.

• Each applicant’s asset management

plan is assessed by the Province for

completeness in comparison to the

2012 Guide.

• All recipients must submit their asset

management plans to the Province in

order to receive funding.

• Recipients can plan for the future by

building their stable / predictable funding

for capital projects into their asset

management plans.

• Recipients can spend their funding to

develop and improve their asset

management plans.

Momentum on Asset Management

● Ontario’s municipal infrastructure strategy has focused on improving asset

management planning since 2012.

● The end goal is for municipalities, the province, and the federal government to

collectively leverage asset management planning to make infrastructure more

sustainable.

● To support further improvements in municipal asset management planning the

province has been developing a proposed regulation under the authority of the

Infrastructure for Jobs and Prosperity Act, 2015 since early 2016

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Consultations with Municipal Sector

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Formed a group of technical experts from

the municipal sector to help draft regional

consultation material. February - May 2016

July - August 2016

Online and regional consultations held

throughout Ontario – 330+ people from 220

municipalities/other organizations attended.

December 2016

Online summary report posted to

Ontario.ca on feedback received

during summer 2016 consultations.

May - July 2017

Revised regulatory proposal posted to

Ontario Environmental/Regulatory Registries

for comment; webinars held on proposal.

September 2017

June 2016

AMO MOU Table

AMO MOU Table

Next Steps

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• Implementation of tools and

supports; building capacity of

municipalities

• Compliance phased in

gradually

• Proposed regulation is finalized

• If approved, regulation is filed,

posted to e-Laws website

• Develop tools and supports

December 2017 2018 – ongoing

QUESTIONS?

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