Infrastructure funding for Quebec municipalities on the way: Legault

Premier François Legault holds a press conference after Question Period, Wednesday, May 8, 2024, at the National Assembly in Quebec City. (Karoline Boucher/The Canadian Press)

Premier François Legault says he's confident that the gas tax and Quebec contribution (TECQ) issue has almost been settled with Ottawa, which is a source of satisfaction for the Union des municipalités du Québec (UMQ), whose members are meeting in Montreal.

Legault was a guest of the UMQ on Thursday morning at the opening of its annual meeting, attended by over 1,500 elected officials, municipal managers and partners from all regions of Quebec.

"I would have liked to be able to announce some good news," concerning the Quebec Gas Tax and Contribution Program (TECQ), the premier began.

But instead of being able to do so, Legault told the elected officials gathered at the Palais des congrès that Finance Minister Eric Girard had told him that the file was "99.9 per cent settled" and that he would be able to make an official announcement "in the next few days."

Relief for municipalities

The TECQ is "the subsidy program most appreciated by municipalities for underground infrastructure work," explained UMQ President Martin Damphousse.

The program, which is mainly financed by the federal government, expired on Dec. 31.

Ottawa must now come to an agreement with each of the Canadian provinces to provide further funding.

But according to the UMQ, new conditions proposed by the federal government were delaying the transfer of funding and creating serious concerns among municipalities, especially as the season for major infrastructure work has begun.

"Municipalities across Quebec have launched their calls for tenders for major works. But the money isn't there yet. So we're hoping to get confirmation so we can award municipal contracts with the subsidies we're waiting for. The summer period is when the work is done," explained Damphousse, who is also Varennes mayor.

"Mr. Legault came to tell us that it's 99.9 per cent settled" and "we're talking billions of dollars," so "that's very good news," he said.

"We mustn't forget that the federal government also wanted to impose new conditions. And now Mr. Legault has confirmed that (...) the new conditions, the reporting requirements that are complicated for the municipal sector, will be withdrawn," said Damphousse.

'No more room to manoeuvre in Quebec City'

In his address to municipal elected officials, Legault acknowledged that "the environment, public transit, housing, homelessness, it puts a lot, a lot of pressure on your budgets."

Nevertheless, Legault believes his government is doing its fair share.

"When I arrived in 2018, under the Liberals, transfers to municipalities were $5 billion a year. Today, transfers to municipalities are $7.3 billion a year," said the premier.

 "I know you would like us to do more, but I still want us to agree that it was a priority for us to help you," he said, pointing out that "there is no more leeway in Quebec City than there is in the municipalities.

Even if the mayors don't "always agree" with the provincial government, "the important thing is that we're all working for the same world," the premier said.

According to Legault, to finance the growing needs of municipalities, it is necessary to "create wealth," and this will involve the energy transition.

"With Hydro-Québec's major projects in wind power and dams, we're preparing for an economic boom, and it's the companies that want to decarbonize that will pay for these investments," and "the best is yet to come for the economy, so we'll be able to increase our tax base in Quebec City and the municipalities," said the premier.

- This report by The Canadian Press was first published in French on May 23, 2024.