Vancouver mayor 'gobsmacked' by economic recovery funding shortfall

Amy Smart
·3 min read

Vancouver Mayor Kennedy Stewart says he isn't happy with the city's share of economic recovery funding from a federal package to help cope with COVID-19.

The federal government announced in July it was sending $19 billion in funding to the provinces and territories to help refuel their economies during the pandemic. The program included $2 billion earmarked to support municipal operating costs for a six- to eight-month period.

Kennedy Stewart said he learned Tuesday night that Vancouver will receive $16 million, not the $60 million he expected based on per capita distribution of the money.

It's not typically the federal government's role to fund municipal operating budgets, but Stewart said he believes he was partially responsible for securing the money by pushing Ottawa to act as part of the big-city mayors caucus.

"I'm really pretty gobsmacked about getting shafted over this," Stewart told a council meeting on Wednesday.

"I really think that this money would never have come to the province if it wasn't for the big-city mayors negotiating it. And now they've decided to ... take it away from big cities where it's needed the most and spread it to small municipalities that aren't having the same struggles."

Stewart said many of the biggest economic challenges caused by COVID-19 are concentrated in bigger cities where businesses are shutting down and homelessness is rising.

Municipal Affairs Minister Selina Robinson said in a statement that local government funding through the federal program was designed to be fair and help big and small communities.

The funding formula provides more money to larger communities but a higher per capita level of funding for smaller and mid-sized communities for a reason, she said.

"We know that smaller municipalities generally do not have reserves to draw on like larger municipalities and many small communities, especially tourism-dependent ones, have less diverse revenue bases that have been hit hard by COVID-19," she said.

The B.C. government's support for Vancouver also includes $644 million to fully cover losses in the transit service and funding for hundreds of temporary spaces and hotel purchases to help homeless people, Robinson said.

Corinne Havard, spokesperson for Intergovernmental Affairs Minister Dominic LeBlanc, said the federal government asked the provinces to explain their plans for the funding but they were not required to distribute it on a per capita basis.

"The final decision about the funding formula for municipalities lies with the provinces," Havard said.

In a statement, Stewart said "tough choices" lie ahead for the city, such as increasing property taxes or making cuts to core services.

He said Montreal will receive the highest per capita handout at about $154, while Toronto gets about $97. Vancouver will receive about $26 per capita.

The mayor of nearby Surrey, which receives $14.8 million, said he was "grateful" for the money the city is getting.

"I want to extend my sincere thanks and appreciation to the federal and provincial governments for their support to Surrey and all municipalities," said Doug McCallum. "This new funding ensures that Surrey will continue to operate in a position of relative strength despite the challenging circumstances.”

Eligible costs for the funding include revenue shortfalls, facility reopening and operating costs, emergency response costs, bylaw enforcement, fire and police services, and aid for vulnerable persons.

This report by The Canadian Press was first published Nov. 4, 2020.

Amy Smart, The Canadian Press