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Provincial cuts to impact region

Numerous services face decreased funding

By Chris Jones/The Oshawa Express

As the provincial government looks to cut spending, regional council has been appraised of how the actions of the Ford government will affect Durham.

At their most recent committee of the whole meeting, regional councillors were shown the consequences of this year’s provincial budget and how it will affect the region.

The presentation given by Nancy Taylor, the region’s commissioner of finance, and CAO Elaine Baxter-Trahair notes the province faces a $15 billion deficit and a provincial debt in excess of $340 billion.

In response to the debt, the province has launched a line-by-line review of all spending within government ministries and agencies.

The budget could have an effect on public health, paramedic services, social services and conservation authorities, according to Taylor.

She said for the 2019-2020 fiscal year, public health will face a minimal impact for that year.

She notes there is good news in the public health sector as the implementation of a low-income seniors dental program is set to proceed in 2019.

There will be an annual allocation of $1.6 million in Durham for the program, 100 per cent funded by the province.

For paramedic services, she notes there will be no increases to subsidies provided by the province.

“The challenge with that is that means 2019 is frozen at 2018 funding levels, but the 2018 funding levels are based on the 2017 budget,” Taylor council.

A funding shortfall of around $1.75 million is anticipated in 2019 compared to what the region was expecting.

“So, the 2019 funding does not cover off inflation pressures or funding for increased services at the region that were approved in those prior years,” said Taylor.

According to Taylor, children’s services will see a decrease from the province of $1.85 million this year.

“That may impact operations of child care operators,” she notes.

She notes there are new cost sharing ratios, as the region will now have to pay 20 per cent of the operating costs, which was previously fully funded by the province.

Taylor estimated this will be an additional $2 million in costs, retroactive to April 1, 2019.

Administration costs are now limited to five per cent of the total eligible base expenditures, down from the previous 10 per cent mark, and are now shared on a 50/50 basis between the region and province, according to Taylor.

There is an estimated shortfall of $1 million in administration funding for 2019, but again Taylor notes there are no funding guideline details to determine this with absolute certainty.

The Community Homelessness Prevention Initiative is set to lose $1.1 million in funding for the 2019-2020 fiscal year, resulting in an $825,000 impact on the regional budget.

Taylor notes these changes may impact operations of support agencies which assist the homeless in Durham.

In regards to the Canada-Ontario Community Housing Initiative (COCHI), Taylor explains the new program, which was designed to replace an expiring federal program, was expected to provide a top-up of around $805,000 to help deal with the transition.

However, the region has now been allocated $525,000, and, there is no details provided to help the region understand what that allocation is based on according to Taylor.

“There is some anticipation of actual increases in administration costs because it’s a brand new program,” explained Taylor.

There were also amendments made to the Housing Services Act, which Taylor explained is meant to simplify the rent-geared-to-income calculation.

For income and employment supports, Taylor said the region must contribute three per cent more than its 2018 provincial funding levels, otherwise they will face a claw-back of up to 15 per cent of upload funding.

According to Taylor, in 2018 Durham received an allocation of $6.8 million in combined administration and client funding.

“That being said, staff feel that being able to accomplish those outcomes is likely, so hopefully this issue may be mitigated somewhat through that,” said Taylor.

Taylor also notes as Metrolinx has terminated their Service Delivery Agreement with the region effective June 29, the region expected to recover $90,000 in 2019, but only recovered around $60,000, a loss of $30,000.

The final three years of the four year Ontario Municipal Commuter Cycling program have also been cancelled, meaning the region lost out on approximately $12 million which would have gone towards the region’s cycling infrastructure.

The province is no longer moving forward with the previous Liberal government’s proposed increase to the municipal share of gas tax funding.

“The previous plan was they would increase funding from two cents per litre to four cents per litre,” Taylor explained. “That is an estimated $10 million in lost revenue over the next couple of years.”

Under the previous plan, gas tax revenue increases were to support service improvements and other priorities.

According to Taylor, the province has plans to consult with municipalities to review the provincial gas tax program parameters in order to identify opportunities for improvement.

Funding for flooding-related programs is proposed to be reduced by 50 per cent in 2019, falling from $7.4 million to $3.7 million across Ontario for conservation authorities.

The Ministry of the Solicitor General introduced the new Community Safety and Policing Grant this year, which replaced four legacy grant programs, three of which impacted the Durham Region Police Service.

The new funding formula involves a competitive process for two of them, and the concern is the Ontario Provincial Police is now eligible to apply for the grants.

According to Taylor since the OPP is now eligible to compete there is a risk this funding won’t be available to other police forces.

Taylor notes based on the legacy grant consolidation, most police services have experienced a 25 per cent overall funding reduction.

On the other hand, the Court Security and Prisoner Transportation program provincial funding is approximately $382,000 more than originally planned, and is $183,000 more than in 2018.

The commissioner of finance also took note of proposed amendments to the Development Charges Act, such as the removal of the statutory 10 per cent reduction for waste diversion services, and cancellation of the cap and trade program, which funded several greenhouse gas emission reduction initiatives.

The next steps according to Taylor are to determine the overall financial impact to the region, as additional information is required.

Staff will report to regional council as more information becomes available, and Taylor noted the delivery of information is “fragmented” and shared with different sectors at different times.

She also notes details of some announcements remain unknown right now.

Staff will give a report to the June committee of the whole meeting.