Liberals Giving Kingston 'Raw Deal':
Conservative Leader Warns of Changes

John Tory Leader of the Ontario PC Party

Ian Elliot
Kingston Whig-Standard
April 21, 2005

The provincial Conservatives warned yesterday that Liberal cuts to payments to municipalities may force Kingston to raise taxes, cut services or dip into cash it thought was a windfall, such as the city's share of gas taxes.

Conservative Leader John Tory warned that the McGuinty government's changes to the Community Reinvestment Fund - money that pays for services downloaded to municipalities by Queen's Park - will cost Kingston millions over the coming years.

"Kingston is getting a raw deal from the McGuinty Liberals," Tory said in a release, claiming the province may have to allow cities to use gas tax money to offset the shortfall even though that money was supposed to be earmarked for transit.

"Even though Kingston is receiving gas tax money, it won't be able to use it for transit because it's quietly being clawed back elsewhere," Tory charges. "They will either have to raise taxes or cut services."

A report presented to Kingston politicians this week by Gerard Hunt of the city's finance department explained the problem.

It indicated a growing shortfall between what the city could have expected from the old reinvestment fund and what it stands to get from the new Ontario Municipal Partnership Fund that replaces it. It indicated a $1.4-million shortfall next year and by 2009, the shortfall would rise to $3.1 million once a series of phase-in grants expire.

At Queen's Park, the Liberals defended their decision by saying the reinvestment fund needed a revamp and that the government was putting extra money into other programs that will benefit municipalities.

Brendan Howe, Tory's spokesman, said the cuts will affect municipalities across the province - the party estimates the provincewide effect at $47 million - and may force the government to loosen restrictions on the spending of gas tax rebates.

"You never know," he said last night.

"There have been lots of programs that the government has said are dedicated to one thing but they go back later and change it."

Mayor Harvey Rosen has already complained, in his meetings with other eastern Ontario mayors, about changes to the reinvestment fund and the loss of provincial money to the city.