2013-2014
Departmental Performance Report
Supplementary Information Table
Details of Transfer Payment Programs

Canada Strategic Infrastructure Fund (CSIF)

1. Name of Transfer Payment Program: Canada Strategic Infrastructure Fund

2. Start Date: 2003-2004

3. End Date: 2016-2017²

4. Description: This program supports projects that sustain economic growth and enhance the quality of life of Canadians. Investments are made in cooperation with the provinces, territories, municipalities, and the private sector, and contribute to the construction, renewal and/or enhancement of public infrastructure. The Canada Strategic Infrastructure Fund leverages additional contributions from other partners by providing up to 50 percent funding for eligible projects.³

5. Strategic Outcome: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved: In 2013-2014, the Department continued to monitor and deliver the program with provincial and territorial partners and Transport Canada for the Canada Strategic Infrastructure Fund:

• 7 projects valued at over $300 million were completed; and
• 26 projects worth $4.4 billion are still underway.

As of this fiscal period, a total of 83 projects have been funded under the program, and more than $4 billion in federal funding has been committed to these projects. Collaboration with federal delivery partners and stakeholders is effectively supporting program delivery. Nearly 70 percent of projects are completed.

The largest categories of investment under the Canada Strategic Infrastructure Fund are the following: highway and rail infrastructure, with a total federal investment of nearly $1 billion, and local transportation infrastructure, which consists primarily of public transit projects, with a total federal investment of close to $900 million.

Infrastructure Canada has largely met its targets under the program and intends to continue the monitoring and due diligence of ongoing projects to ensure their completion as part of the closeout activities of the program. A recent evaluation has recommended improvements to the project outcomes measurement in order to better report on program benefits to Canadians. Consequently, Infrastructure Canada is putting in place measures to improve project outcomes reporting for projects not yet completed.

16. Comments on Variances: Actual Spending in 2013-2014 was lower than originally projected, given that CSIF projects are large-scale and complex in nature, many unknowns may arise during the course of the fiscal year. These factors range from lower than anticipated project costs to project delays resulting from inclement weather and from technical and other construction-related complexities that also cause construction delays, which explain deviations of actual expenditures from the original forecast.

It is also important to note that actual disbursement of federal contributions lag behind the actual construction of projects as recipients are reimbursed for expenditures only once they submit claims. The CSIF program was extended in 2011-2012, to allow recipients that have encountered construction delays to access the remainder of their federal contribution in order to complete their projects as expected.

17. Audits Completed or Planned: Audits of the Canada Strategic Infrastructure Fund program were conducted in 2007-2008 and in 2012-2013. Completed audits are available on the departmental website.

18. Evaluations Completed or Planned: A joint evaluation of the Canada Strategic Infrastructure Fund and the Border Infrastructure Fund was started in 2012-2013, and completed in July 2014.

19. Engagement of Applicants and Recipients: All funding available for projects under this program has been committed. The Department continues to work with recipients to flow funding, including final payments and ensure that projects are closed.

Border Infrastructure Fund (BIF)

1. Name of Transfer Payment Program: Border Infrastructure Fund

2. Start Date: 2003-2004

3. End Date: 2015-2016⁴

4. Description: This program provides funding for investments in physical infrastructure, transportation system infrastructure and improved analytical capacity at the largest surface border crossings between Canada and the United States, as well as several other crossing points in Canada. Announced in Budget 2001, the fund provides up to 50 percent federal funding to support eligible projects at Canada's border crossings. Transport Canada is the federal delivery partner for this program.⁵

5. Strategic Outcome: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved: As of March 31, 2014, a total of nine projects have been completed under the Border Infrastructure Fund, generating over $690 million in infrastructure investments for transportation systems that promote improvements in the efficiency and capacity at border crossings. Since the inception of the program, the federal government has announced support for 11 border improvement infrastructure projects, with a combined total investment of $1.2 billion.

In 2014-2015, Transport Canada will continue to support the implementation of the final two projects under the Border Infrastructure Fund on behalf of Infrastructure Canada, with a total eligible cost of $515.2 million. A recent program evaluation has recommended to improve outcomes measurement for the program in order to better report on the program benefits to Canadians. Infrastructure Canada is putting in place measures to improve project outcomes reporting for projects not yet completed.

16. Comments on Variances: Transportation projects funded under the BIF are large and complex by nature which makes them at higher risk of experiencing unexpected delays during their implementation as the case in previous year. Projects faced delays due to various reasons from technical and other construction-related complexities. Those factors lead to delays in the disbursement of federal contributions which lags the actual construction of projects as recipients are reimbursed for incurred expenditures only once they submit claims.

17. Audits Completed or Planned: The Audit of the Management Control Framework of the Canada Strategic Infrastructure Fund (CSIF) and the Border Infrastructure Fund (BIF) was completed in 2007-2008.

18. Evaluations Completed or Planned: A joint evaluation of the Canada Strategic Infrastructure Fund and the Border Infrastructure Fund was completed in July 2014.

19. Engagement of Applicants and Recipients: All funding available for projects under this program has been committed. The Department continues to work with recipients to flow funding, including final payments and ensure that projects are closed.

Municipal Rural Infrastructure Fund (MRIF)

1. Name of Transfer Payment Program: Municipal Rural Infrastructure Fund

2. Start Date: 2004-2005

3. End Date: 2014-2015⁶

4. Description: This program supports small-scale municipal infrastructure projects designed to promote and improve quality of life in both urban and rural communities. The program initially provided $1 billion in federal funding and was augmented with an additional $200 million in Budget 2007. At least 80 percent of funding under the program has been dedicated to municipalities with a population of less than 250,000. For most projects, the MRIF provides up to one-third funding for eligible projects. Its long-term commitment to public infrastructure helps promote sustainable economic growth, innovation and healthy communities. Projects contribute to the construction, renewal and/or enhancement of public infrastructure to build capacity in partnership with recipients. It is delivered through a partnership with federal regional development agencies.⁷

5. Strategic Outcome: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved:  The Municipal Rural Infrastructure Fund program formally concluded on March 31, 2014 in most provinces and territories. Over the past year, Infrastructure Canada, in close collaboration with federal delivery partners, has focused on program closeout activities. A process was developed and adopted by Infrastructure Canada and the federal delivery partners in order to have consistent and effective procedures to monitor the Municipal Rural Infrastructure Fund program closeout. Partners are now actively implementing the closeout guidelines.

Infrastructure Canada has met its targets for the year. To date, over 95 percent of projects funded under the Municipal Rural Infrastructure Fund have been successfully completed, representing $922 million in federal funding.

16. Comments on Variances: Program spending in 2013-2014 was lower than planned. This can be attributed to a number of factors beyond the control of funding recipient. Those factors such as inclement weather, geological challenges and technical delays and other construction-related complexities can lead to construction delays, which in turn causes claims to lag and be submitted for reduced amounts.

17. Audit Completed or Planned: An audit of the Municipal Rural Infrastructure Fund was completed in 2011-2012.

18. Evaluation Completed or Planned: An evaluation was completed in 2008. No further evaluation is planned.

19. Engagement of Applicants and Recipients: All funding available for projects under this program has been committed. The Department continues to work with recipients to ensure that the program is closed down.

Gas Tax Fund (GTF)

1. Name of Transfer Payment Program: Gas Tax Fund

2. Start Date: 2005-2006

3. End Date: Ongoing⁸

4. Description: This program provides municipalities with predictable long-term funding, enabling construction and rehabilitation of core public infrastructure. The federal government has concluded Gas Tax Fund Agreements with provinces, territories, the Association of Municipalities of Ontario, the Union of British Columbia Municipalities and the City of Toronto, which were in effect from 2005-2006 to 2013-2014. Moreover, all Gas Tax Fund Agreements have been signed for the permanent Gas Tax Fund, starting in 2014-2015. Gas Tax Fund Agreements establish an accountability framework allowing the Government of Canada to flow Gas Tax Fund money twice a year to signatories which, in turn, flow funds to municipalities based on an agreed-upon allocation formula. For their part, municipalities decide which projects to prioritize within established investment categories. Projects focus on environmental objectives, including cleaner air, cleaner water and reduced greenhouse gas emissions, and increasing communities' long-term planning capacities. Municipalities can pool, bank and borrow against this funding, providing significant additional financial flexibility. Eligible recipients are required to report annually on their use of funds and their compliance to terms and conditions of the Gas Tax Fund Agreements.⁹

5. Strategic Outcome: Provinces, territories, and municipalities have federal financial support for their infrastructure priorities.

6. Results Achieved: In 2013-2014, Infrastructure Canada continued to provide provinces, territories and municipalities with stable and predictable Gas Tax funding. As reported in the 2012-2013 expenditure reports, all projects funded under the Gas Tax Fund helped to build and improve public infrastructure that contributes to cleaner air, cleaner water, or reduced greenhouse gas emissions. Capacity building projects funded under the Gas Tax Fund also supported integrated municipal planning.

Progress on the completion and submission of Outcomes Reports by recipients was delayed in certain jurisdictions. Some recipients noted that the launch of negotiations for the renewed Gas Tax Fund, combined with limited capacity, resulted in an inability to finalise, approve and submit the Outcomes Reports to Infrastructure Canada.

Under the Gas Tax Fund, predetermined yearly allocations are expected to flow to provinces and territories according to a regular payment schedule. However, the release of funding is tied to the submission of an annual expenditure report (AER). Delays in compliance with this program requirement result in payment delays, which are remedied upon reception and acceptance of the reports. In 2013-2014, the submission of previous year outstanding reports explains the difference between the planned and actual funds flowed.

Infrastructure Canada also made very significant progress on the renewal of the Gas Tax Fund. Extensive discussions were held with provinces, territories and other stakeholders to finalize program parameters and, in November 2013, administrative agreements for the renewed Gas Tax Fund (2014-2015 to 2023-2024) were shared with all the signatories. Audit and Evaluation recommendations, notably in regards to improving federal visibility and communications under the program, have been implemented and revamped communications protocols are integral to all agreements. As of July 31, 2014, negotiations for the renewed Gas Tax Fund were completed and agreements signed with all jurisdictions.

16. Comments on Variances: Federal funds flowed to Gas Tax Fund signatories are dependent on the submission of Annual Expenditure Reports and audit statements. In the absence of duly completed reports, Infrastructure Canada can withhold funds from recipients until such time that completed reports are accepted. In such cases, releasing withheld funds can result in actual spending surpassing spending forecasts as was the case for 2013-2014.

17. Audit Completed or Planned: : An audit of the Management Control Framework for the Gas Tax Fund was completed in 2009-2010.

19. Engagement of Applicants and Recipients: With program design for the permanent GTF now approved, negotiations took place with all jurisdictions to finalize bilateral agreements. As of July 31, 2014, all agreements are signed and funds have begun to flow.

Provincial-Territorial Infrastructure Base Fund (PT Base Fund)

1. Name of Transfer Payment Program: Provincial-Territorial Infrastructure Base Fund

2. Start Date: 2007-2008

3. End Date: 2015-2016¹⁰

4. Description: This program provides base funding to each province and territory for core infrastructure priorities. In addition, funding under the Building Canada Fund for the three territories is managed under this fund. The Provincial-Territorial Infrastructure Base Fund was designed to help restore fiscal balance while enhancing Canada's public infrastructure system. It also supports economic growth and productivity, and promotes a cleaner environment and prosperous communities. While payments are made to provinces and territories, ultimate recipients can also include local and regional governments or private sector bodies. In order for federal funding to flow, provinces and territories submit a list of infrastructure initiatives through a capital plan which must be accepted by the Minister of Infrastructure, Communities and Intergovernmental Affairs, and Minister of the Economic Development Agency of Canada for the Regions of Quebec. Payments are made in advance and cost-sharing provisions apply to a capital plan as a whole, and not individual initiatives. Provinces and territories may pool, bank, or cash-manage these funds to give them flexibility in implementation.

5. Strategic Outcome: Provinces, territories, and municipalities have federal financial support for their infrastructure priorities.

6. Results Achieved:  Following the acceleration of the Provincial-Territorial Infrastructure Base Fund (PT Base Fund) as part of the 2009 Economic Action Plan, all funds available under the Provincial-Territorial Infrastructure Base Fund ($2.3 billion) have been committed as of March 31, 2014.

During the reporting period, seven amended capital plans were approved under two jurisdictions, committing an additional $3.6 million in federal funding and leveraging $6.8 million from partners for 12 new initiatives.

Provincial-Territorial Infrastructure Base Fund program parameters require provinces to cost share funds equal to the federal contribution for projects identified in their capital plans. For their part Territories are required to contribute funds representing at least a third of the federal contribution. Actual results show that provinces and territories have contributed well beyond the program's cost sharing requirements.

Infrastructure Canada continues to work with provincial and territorial governments to ensure that the required reports are submitted in a timely fashion, and the Department provides guidance on any issues that may arise during the provincial or territorial audit that would potentially delay their report submissions and related payments. By the end of 2013-2014, two jurisdictions have completed all reporting obligations and have received their final payments under the PT Base Fund.

* Totals do not add up due to rounding.

16. Comments on Variances: Under the PT Base Fund, the Government of Canada's flow of funding to the provinces and territories is subject to the submission and federal acceptance of Capital Plans and/or Expenditure Reports. As reporting is cumulative, any delay in the submission of a given report will result in delays to subsequent reports, and related payments. In one jurisdiction, reporting is significantly behind resulting in four delayed payments. In addition, the final report must demonstrate that all PT Base Fund initiatives have been completed; however this requirement was not met by eight jurisdictions by the end of 2013-2014, thus delaying the submission of final reporting.

17. Audit Completed or Planned: An audit of the PT Base Fund was completed in 2011-2012.

18. Evaluation Completed or Planned: An evaluation of the PT Base Fund was completed in 2012-2013.

19. Engagement of Applicants and Recipients: The Department continues to work with jurisdictions to flow funding, including final payments, under the PT Base Fund.

Building Canada Fund–Communities Component (BCF–CC)

1. Name of Transfer Payment Program: Building Canada Fund–Communities Component

2. Start Date: 2008-2009

3. End Date: 2016-2017

4. Description: This program supports infrastructure needs of small communities with populations of less than 100,000. Projects costs are shared with provincial, territorial and municipal governments, with each order of government generally contributing one-third of the eligible costs. The fund supports the construction, renewal and enhancement of basic infrastructure such as potable water, wastewater treatment, local roads and other infrastructure needs of small communities.¹¹

5. Strategic Outcome: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved: In 2013-2014, Infrastructure Canada and its federal delivery partners made significant progress in implementing the Building Canada Fund–Communities Component program:

• 65 projects valued at $328 million were completed;
• 20 additional projects worth $49 million began construction; and
• 247 projects worth $1.3 billion are still underway.

As of this fiscal period, a total of 930 projects have been funded under the program, and over $1 billion in federal funding has been committed to these projects. Collaboration with federal delivery partners and stakeholders is effectively supporting program delivery. Over 70 percent of projects have been completed even though three years remain in the program.

Infrastructure Canada has also contributed to an additional 14 projects in Quebec through a federal allocation of $200 million under the Large Urban Centres Component of the Building Canada Fund.

The largest investments under the Building Canada Fund-Communities Component by categories are the following: wastewater infrastructure, with a total federal investment of $348 million; water infrastructure, with a total federal investment of close to $260 million; and local road infrastructure, with a total federal investment of over $172 million.

The actual number of projects completed by proponents during the fiscal year and, as a consequence, the total value of projects completed were lower than forecasted for a number of reasons including inclement weather, technical and other construction-related complexities that led to construction delays. Construction on these projects continues and Infrastructure Canada will continue to reimburse recipients as claims are submitted.

Program delivery policies and tools have been implemented to improve monitoring and reporting on the progress of the Building Canada Fund–Communities Component. These tools focus on improving reporting and data quality requirements of the program as this has been identified as an area of improvement for the program. A program evaluation is planned for 2014-2015 and recommendations will be addressed as Infrastructure Canada continues to work with the provinces to ensure that this program moves towards closure in the next three years.

16. Comments on Variances: Program spending in 2013-2014 was lower than planned. This can be attributed to a number of factors beyond the control of funding recipients. These factors range from lower than anticipated project costs to project delays resulting from inclement weather and from technical and other construction-related complexities that can lead to construction delays, which in turn cause claims to lag and be submitted for reduced amounts. It is also important to note that the disbursement of federal contributions follows the actual construction of projects as recipients are reimbursed for incurred expenditures only once they submit claims.

17. Audit Completed or Planned: An audit of the Building Canada Fund-Communities Component was completed in 2011-2012.

18. Evaluation Completed or Planned: An evaluation of the Building Canada Fund-Communities Component is planned for completion in 2014-2015.

19. Engagement of Applicants and Recipients: The Department is working with partners and stakeholders to ensure timely completion of projects under the Building Canada Fund–Communities Component

Building Canada Fund–Major Infrastructure Component (BCF–MIC)

1. Name of Transfer Payment Program: Building Canada Fund–Major Infrastructure Component

2. Start Date: 2008-2009

3. End Date: 2018-2019¹²

4. Description: This program targets larger infrastructure projects of national or regional significance. It increases overall investment in public infrastructure and contributes to broad federal objectives: economic growth, a cleaner environment, and strong and prosperous communities. At least two-thirds of the funding is targeted to national priorities: water, wastewater, public transit, the core national highway system and green energy. The Major Infrastructure Component has 12 additional eligible categories of investment, and priority projects are identified through discussions with provinces. By providing federal funding on a cost-shared basis, it leverages additional contributions from other partners to increase overall investment in infrastructure. Eligible recipients include provinces, local or regional governments and private sector bodies, including non-profit organizations. Projects must be supported by a business case and undergo a federal review against key program criteria.¹³

5. Strategic Outcome: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved: In 2013-2014, Infrastructure Canada and its federal delivery partners made progress in the implementation of the Building Canada Fund-Major Infrastructure Component:

• 15 projects valued at close to $3 billion were completed;
• 19 additional projects worth close to $3 billion began construction; and
• 122 projects worth $16.5 billion are still underway.

As of this fiscal period, a total of 188 projects have been funded under the program, and over $7.2 billion in federal funding has been committed to these projects. Collaboration with federal delivery partners and stakeholders is effectively supporting program delivery. Nearly 40 percent of projects are completed.

The largest investments under the Building Canada Fund–Major Infrastructure Component by categories are as follows: public transit infrastructure, with a total federal investment of over $3 billion, and national highway system infrastructure, with a total federal investment of over $2 billion.

The total number of projects completed by project proponents this fiscal year and, as a consequence, the total value of projects completed were slightly lower than the planned target, as some of these large-scale and complex projects encountered delays and were not completed by year-end as forecast. Typically, project delays occur as a result of inclement weather and technical and other construction-related complexities and are beyond Infrastructure Canada's control. However, construction on these projects is ongoing and Infrastructure Canada will continue to monitor progress towards completion and reimburse recipients as claims are submitted.

Program delivery policies and tools have been implemented to improve monitoring and reporting on the progress of the Building Canada Fund–Major Infrastructure Component. It has been noted that forecasting of expenditures under the program is challenging given the large scope of project investments and uncertainties around construction conditions. Infrastructure Canada is implementing measures, such as claims procedures to improve monitoring of expenditures and forecasts. In addition, resources previously assigned to stimulus funding programs are now devoted to the delivery of the program in order to increase monitoring and due diligence capacity as Infrastructure Canada moves towards closure of the Major Infrastructure Component in the next years.

16. Comments on Variances: This program provides significant funding for large, complex projects. It is typical for these projects to require a significant amount of upfront planning, design and procurement. These processes may occur, in whole or in part, after funding commitments are announced. As a result, there is often a period of time that will pass between project announcements and the start of construction. Even when construction has started, a number of factors beyond the control of funding recipients can result in lower spending than forecasted. These factors range from lower than anticipated project costs to project delays resulting from inclement weather and from technical and other construction- related complexities that also cause construction delays, which in turn cause claims to lag and be submitted for reduced amounts. It is also important to note that actual spending lags behind the actual rate of construction of projects since recipients are reimbursed only once claims are submitted, even though eligible costs may have already been incurred.

17. Audit Completed or Planned: No audit has been conducted of this program.

18. Evaluation Completed or Planned: An evaluation of the Building Canada Fund–Major Infrastructure Component is planned for completion in 2015-2016.

19. Engagement of Applicants and Recipients: Although most funding has been committed, Infrastructure Canada continues to work with provinces to identify priorities for remaining funding. The Department continues to work with recipients to flow funding, including final payments, and ensure that projects are closed.

Green Infrastructure Fund (GIF)

1. Name of Transfer Payment Program: Green Infrastructure Fund

2. Start Date: 2009-2010

3. End Date:2018-2019¹⁴

4. Description: This program supports environmental infrastructure projects that promote cleaner air, reduced greenhouse gas emissions and cleaner water. Targeted investments in green infrastructure can contribute to improving the quality of the environment and a more sustainable economy over the longer term. There are five eligible categories of investment: wastewater infrastructure, green energy generation infrastructure, green energy transmission infrastructure, solid waste infrastructure, and carbon transmission and storage infrastructure. By providing up to 50 percent federal funding on a cost-shared basis, the fund leverages additional investments from other partners. Eligible recipients include provinces, territories, local or regional governments, public sector bodies, other eligible non-profit organizations and private sector companies, either alone or in partnership with a province, territory or a government body.

5. Strategic Outcome:  Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment, and liveable communities is provided.

6. Results Achieved: In 2013-2014, Infrastructure Canada made progress in the implementation of the Green Infrastructure Fund. More than $675 million in funding commitment is leveraging nearly $1.2 billion from funding partners for a combined total investment of over $1.8 billion towards 19 projects that will support cleaner air, water and land across the country. To date, one project has been completed and 16 more are still underway valued at over $1.5 billion.

The largest categories of investment under the Green Infrastructure Fund are the following: wastewater infrastructure, with a total federal investment of nearly $300 million, and solid waste management infrastructure, with a total federal investment of over $80 million.

The implementation of the Green Infrastructure Fund has been noticeably slower than for other programs. This is attributable to the nature of projects funded under this program which are innovative and often rely on newly developed technologies. Infrastructure Canada has met its targets under the program and will continue to oversee the implementation of project-specific agreements of the Green Infrastructure Fund, ensuring that the terms of agreements are respected and that claims for payment are processed efficiently.

Note:
In keeping with the Government of Canada's commitment to address priority initiatives within existing funding envelopes, the Government of Canada made a policy decision to transfer $169.98 million from the Green Infrastructure Fund to other federal departments to support high-priority initiatives. Details on the transfers and amounts are as follows:

In addition, as part of the 2010 Strategic Review process, $45 million in unallocated funds from the Green infrastructure Fund were identified for reallocation to other Government of Canada priorities. No announced infrastructure projects were cancelled, or otherwise affected as a result of these reallocations. As well, $58.7 million in unallocated funds from the Green Infrastructure Fund was identified as a source of funds and approved for the operating requirements of the Department for fiscal year 2012-2013.

*Totals do not add up due to rounding.

16. Comments on Variances: This program provides significant funding for large, complex projects. It is typical for these projects to require a significant amount of planning, design and procurement. These processes may occur, in whole or in part, after funding commitments are announced. Once contribution agreements for projects are signed with project proponents, the Government of Canada has a legal obligation to provide the committed funding in accordance with the terms of those agreements.

Actual spending in 2013-2014 was lower than planned. A number of factors beyond the control of funding recipients can result in lower spending than forecasted. These factors range from lower than anticipated project costs to project delays resulting from inclement weather and from technical and other construction- related complexities that also cause construction delays, which in turn cause claims to lag and be submitted for reduced amounts.

17. Audit Completed or Planned: No audit has been conducted of this program.

18. Evaluation Completed or Planned: An evaluation of the Green Infrastructure Fund is planned for completion in 2016-2017.

19. Engagement of Applicants and Recipients: As of July 2011, Infrastructure Canada had received sufficient proposals for the remaining funds. The Department continues to work with recipients to flow funding, including final payments, and ensure that projects are closed.