Holder defends including ineligible costs in BRT funding application
Published Wednesday, July 17, 2019 6:40PM EDT
Don't call it a $50-million dollar mistake. London Mayor Ed Holder is defending city hall's application for Bus Rapid Transit funding, which included about $50 million in ineligible costs
“This was in fact, what it’s fair to call this, is full disclosure - open and honest full disclosure.”
Former city councillor Roger Caranci recalls when city hall applied for senior government funding to build the Hale-Trafalgar overpass, land acquisition costs were not eligible for federal dollars.
”It should have been laid out right out front that the province and the feds will not pay these costs, so we have to foot the bill ourselves.”
The province provided London just $103.5 million of the $125 million requested for 10 transit projects including the three Bus Rapid Transit (BRT) routes.
That decision reduces corresponding federal funding to $124.2 million, which leaves city hall about $50 million short.
On Tuesday, the province explained that city hall included “ineligible” land acquisition costs in its application.
But the mayor defends submitting the full cost of the projects rather than the eligible costs.
"What we should put in is the full amount of the project because that way the federal and provincial governments know the full breadth and scope of the project and they determine what is eligible and what they will consider.”
The reduced amount of funding for the south BRT route means a time consuming Treasury Board review will not be needed before a federal decision.
London North Centre MP Peter Fragiskatos says the rules for eligible costs aren’t new.
"It’s a well-established standard that the federal government does not pay for land acquisition. That is not specific to the Trudeau government. It’s simply how it is.”
Holder says the $50 million shortfall won’t impact taxpayers.
"We already have provisions. We are going to first wait to hear what the federal government comes back with, but between development charges and other mechanisms we are not going to stress the taxpayer at all.”
But Caranci is less optimistic about how council will fill the funding hole.
"The BRT file has been botched regarding informing the public on how things go, and this is a big one - if it’s a $50 million hit to the taxpayers of London.”
City council will likely decide how to pay for the ineligible costs during upcoming multi-year budget deliberations.