Extra $2B tabbed for infrastructure

Moe says funding will get people working, ease blows of pandemic

The Saskatchewan government is looking to build its way out of the economic collapse triggered by the new coronavirus with what Premier Scott Moe called a $2-billion “booster shot” on top of billions already allocated for infrastructure projects.

The government, which has had its revenue projections shattered by the pandemic, expects to borrow that money and add it to the $2.7 billion it was already planning to spend on infrastructure this year, plus another $2.8 billion for the 2021-22 fiscal year.

Speaking at a news conference in Regina, Moe said governments have been paying people to stay home and now is the time to start paying them to go to work on projects that will “further stimulate our economy as we begin to recover.”

Saskatchewan NDP Leader Ryan Meili greeted the announcement with cautious optimism, saying that while “now is the time to invest,” the province should ensure contracts go to Saskatchewan-based companies and more legislative oversight is provided.

“(This is) a large amount of money with a small amount of detail,” Meili said.

The provincial legislature was suspended in mid-march. Saskatchewan

has now gone longer than most other provinces without legislative sittings or committee meetings. Moe said he has not given thought to recalling the legislature, despite calls from the NDP and others.

It is not clear, however, whether the money can be used to help the province’s largest cities make up pandemic-sized holes in their operating budgets, largely the result of lost revenue from transit, recreation facilities and on-street parking — a concern given their inability to run deficits.

Saskatoon Mayor Charlie Clark praised the flexibility built into the new $150-million Municipal Economic Enhancement Program (MEEP) — part of the broader $2-billion package. Clark said Saskatoon expects to receive between $32 and $34 million of that total.

The province’s largest city is facing a year-end deficit of up to $32.9 million, which would have to be made up through taxation in the absence of financial aid from other levels of government. Clark said it is not clear what the provincial announcement means for that shortfall.

“The opportunity that may come into play is … to take some of this money to backfill some of the capital,” Clark said, adding that he expects city administrators to go through the details and report back to council on the broader financial implications.

Regina Mayor Michael Fougere offered a similar perspective, saying the government’s “flexible and rapid response” — Regina expects to receive about $30 million under the MEEP — will make it easier for the city to fund important capital projects and keep construction going.

“With respect to our operating side ... that portion of this equation has not been addressed directly although we do make contributions from capital in our operating budget and that may be looked at as well,” Fougere told reporters in Regina.

Regina had forecast a $20.7 million deficit by the end of September, but made up for it, in part, by deferring more than $6 million worth of capital projects.

The Federation of Canadian Municipalities has meanwhile asked Ottawa for $10 billion to help cities across the country make up for lost revenue.

While Municipalities of Saskatchewan President Gordon Barnhart has previously suggested grants from the provincial government could help cities avoid tax increases, he praised the government’s plan, saying MEEP will “help our economy recover in these challenging times.”

The government’s stimulus package, which is framed using the Saskatchewan Party’s election-year slogan, includes $1.37 billion for large projects such as schools, $300 million for highway improvements and $46 million for municipal road and airport upgrades.

It also includes $181 million to complete deferred maintenance on provincial and third-party assets, including hospitals and schools.

The $320 million dedicated to municipalities includes cash for joint federal-provincial projects under the $900-million Investing In Canada Infrastructure Program.