SAMPLE TRANSMITTAL LETTER TO A MAYOR AND COUNCIL:
“THE URBAN INFRASTRUCTURE CHALLENGE IN CANADA”
[Date]
Dear Mayor [Name]:
I am pleased to provide you with a copy of a major report entitled The Urban Infrastructure
Challenge in Canada: Perceptions and Realities. It was prepared by the noted economists
Altus Clayton and assesses how essential local infrastructure such as roads, public transit,
water supply systems and sewers are financed in Canada. This report documents the fact that
a very large role is already being played by the private sector both in funding and building
essential local infrastructure. The main burden of funding these essential works is falling on
those struggling to enter the housing market, particularly first-time buyers.
Users of municipal services supported by infrastructure and local property tax payers are
actually covering the smallest proportion of the cost – about 21 percent – according to Statistics
Canada and Public Accounts figures. Of this, perhaps half is falling directly on the property tax
base, the remainder being covered by various user charges.
In addition, the Altus Clayton research reveals that the property tax base in most centres across
Canada has been increasing in parallel with both the income and the sales tax bases.
Accordingly, to improve the quality, service life and performance of basic infrastructure will
require users and property tax payers to pay more of the real costs of the infrastructure from
which they receive a great many benefits. This increased share can be met through a
combination of long-term financing techniques and increased emphasis on user-pay principles.
Recognizing that the property tax is not an appropriate means of funding social and income
support programs, our Association is calling for provincial governments to take over the full
costs of social services and programs from the municipalities. Then local property tax revenues
should be able to cover much more of the cost of building and maintaining basic local
infrastructure. The provincial and federal governments have the kind of progressive tax base
that should be used to pay for such programs.
In brief, we would like to see a more balanced approach to infrastructure financing in the future,
recognizing that the current system puts a disproportionate burden on new home buyers and
renters in new buildings. Through a variety of techniques, infrastructure financing can be better
aligned with the benefits flowing from these investments, and can also be paid off over time by
the users of the facilities and services provided. In addition, we believe strongly that our
industry should be playing a more active role in planning infrastructure for the future,
recognizing that most major works of this type have a 50-year life. Long-term capital budgeting
is essential to address the infrastructure challenges of the future.
Yours sincerely,
President
CHBA – [Name]
Canadian Home Builders' Association
June, 2008