Sask. government announces $2B 'economic booster shot'

The Saskatchewan government has announced an additional $2 billion for infrastructure projects in the province.

It said that, including previous commitments, it will now spend $7.5 billion over the next two years to "stimulate Saskatchewan's economic recovery from the impact of the COVID-19 pandemic."  

"This is a $2 billion economic booster-shot over and above the $5.5 billion our government had already planned to invest in capital projects over the next two years and will be an important step in our province's economic recovery," Premier Scott Moe said in a statement Wednesday.

The government said the money will go toward schools, hospitals, highways, Crown utilities and municipal infrastructure.

The "new capital funding" includes:

• $300 million for highways projects.
• $200 million for health infrastructure.
• $135 million for education infrastructure.

The government previously announced $2.7 billion in Crown and executive government capital spending in its 2020-21 Estimates and $2.8 billion in Crown and executive government capital spending projected for the 2021-22 fiscal year.

Injection to assist municipalities, construction industry, government says

The government said the new money will help municipalities and the construction industry, and create jobs.

Here's how more than $320 million for municipal infrastructure breaks down over the next two years:

• A $150 million Municipal Economic Enhancement Program.
• A $130 million Investing in Canada Infrastructure Program.
• $46 million in targeted funding through the Ministry of Highways for municipal roads and airports.

Both the Saskatchewan Urban Municipalities Association (SUMA) and the Saskatchewan Association of Rural Municipalities (SARM) praised the financial commitment.

"We've been advocating for years for the development of a provincial infrastructure program, and we're extremely pleased to see our provincial government implement one to help our economy recover in these challenging times," said SUMA President Gordon Barnhart.

"Investing in municipal infrastructure projects will help rural municipalities in rural Saskatchewan and will certainly help the provincial economy to recover," SARM President Ray Orb said.

On Tuesday, NDP finance critic Trent Wotherspoon called on the government to help out municipalities facing funding shortfalls.

"With facilities like rinks and swimming pools closed, and with far fewer people taking public transit, these local leaders are facing massive revenue shortfalls that they simply cannot respond to adequately on their own. The province needs to work with the federal government to support our cities, towns, villages and rural municipalities," Wotherspoon said.

NDP Leader Ryan Meili said Wednesday he is pleased with the funding but wants the government to ensure it is using Saskatchewan companies and workers on the projects.

Regina and Saskatoon in line for about $30M each through one program

Regina Mayor Michael Fougere said the money for capital projects is welcomed.

Fougere said as much as $30 million could be headed for Regina through the Municipal Economic Enhancement Program (MEEP).

"It is a good way to inject money directly and quickly to get these jobs created and these projects off the ground," Fougere said.

The MEEP funding will be available for two years for "shovel-ready" projects."

Applications can begin by May 19 and money can be doled out by mid-July.

Fougere said the city could submit transportation, water and wastewater management and recreation projects for funding.

Saskatoon Mayor Charlie Clark said the MEEP money offers "flexibility" which will help the city address a number of needs.

Clark has asked his city manager to submit a report on how the MEEP money could be used, perhaps to help offset funding shortfalls on the operating side.

He said the last time MEEP funding was in place was in 2009.

Clark said the city has many needs in the "shovel-ready" category, including expanding road repairs, addressing water and sewer and fixing or upgrading equipment.

He said he wanted to be "cautious" and not commit to specific projects at an early stage.

"As I understand [the government] want to get those rolling by July, so these will be projects that are shovel-ready and ones that we can turnaround quickly."

Saskatoon and Regina trying to balance books

The cities of Saskatoon and Regina have multi-million dollar operating shortfalls, but the newly announced provincial money will not go toward those directly.

Last week, the City of Saskatoon said it would make cuts to expenses and dip into reserve funds to keep essential services going during the COVID-19 pandemic, but there are no plans for a tax hike.

The city is looking at a budget deficit of about $32 million by the end of 2020, even after money-saving measures and cuts have been implemented. 

"Relief from the federal and/or provincial governments could assist in filling the gap. If relief is not provided, the city must find a way to balance the budget at year-end," said Kerry Tarasoff, chief financial officer, in a report to council last week.

Municipal governments are bound by provincial legislation, the Cities Act, to post balanced budgets on an annual basis. Any deficit from 2020 would be added to the bill in 2021.

Last month the City of Regina was looking at a $20.7 million revenue shortfall by the end of September.

With many operations that make money for the city shuttered, the revenue shortfall was projected to sit around $7.7 million on April 30, rising to $12.1 million by June 30. Like many municipalities, Regina can borrow, but cannot run a deficit.

Regina councillors approved plans to redistribute and reduce costs to stay afloat. 

"We have bridged that gap for the moment," said Mayor Michael Fougere on April 15.

"We're looking at $7.5 million from expense reductions and another $7.2 million on capital programs and other projects that are funded to offset operating costs, so we're good until the fall."