: Ontario Municipal Partnership Fund - Heads of Council Letter

Ministry of Finance


Office of the Minister

7th Floor
Frost Building South
7 Queen's Park Cr
Toronto ON M7A 1Y7
Tel (416) 325-0400
Fax (416) 325-0374
www.fin.gov.on.ca

Ministry of Municipal Affairs and Housing

Office of the Minister

17th Floor
777 Bay Street
Toronto, ON  M5G 2E5
Tel (416) 585-7000
Fax (416) 585-6470
www.mah.gov.on.ca

Province of Ontario coat of arms

November 17, 2015

Dear Head of Council:

We are writing to announce the release of the Ontario Municipal Partnership Fund (OMPF) program allocations for 2016.

In 2016, the Province will provide a total of $505 million in unconditional funding through the OMPF to 388 municipalities across the province.  This funding, combined with the municipal benefit resulting from the provincial uploads, will total more than $2.3 billion in 2016.  This is nearly four times the level of funding provided in 2004.

As you know, 2016 is the final year of the phase-down of the OMPF program that was announced in 2012, and was part of our 2008 upload agreement with the Association of Municipalities of Ontario (AMO) and other municipalities.  The redesigned program, introduced in 2014, supports municipalities with limited property assessment; recognizes the unique challenges of northern and rural municipalities; and better targets funding to northern and rural municipalities with more challenging fiscal circumstances. 

Over the past year, the Province has continued to consult with AMO and other municipal representatives to further refine the design of the OMPF to ensure that the program meets the long-term priorities of municipalities. The 2016 OMPF reflects the core objectives of the redesigned program, while balancing the range of views expressed by municipalities through this year’s consultations. 

As announced in the 2015 Ontario Budget, to further support northern municipalities, the Northern Communities grant component of the OMPF will be enhanced to $84 million in 2016, increasing the total 2016 OMPF to $505 million rather than the $500 million previously planned for 2016.

The 2016 program will further  target funding to northern and rural municipalities with more challenging fiscal circumstances by increasing the Northern and Rural Fiscal Circumstances Grant to $67 million from $55 million in 2015. 

Also beginning in 2016, the Rural Communities Grant, which continues to support rural farming communities, will be enhanced to $143 million.  This funding increase will be targeted to municipalities with the highest levels of farm land, in recognition of their unique challenges.

Through the consultation process, we have heard that ensuring a manageable transition to the redesigned program continues to be an important focus for many municipalities. In response to this feedback, the 2016 minimum funding guarantees for municipalities in southern Ontario will be increased to at least 85 per cent of their 2015 OMPF allocation. Northern municipalities will continue to receive at least 90 per cent of their 2015 OMPF allocation. These minimum levels of support will be further enhanced up to 100 per cent for municipalities with more challenging fiscal circumstances.

The Ministry of Finance’s (MOF) Provincial-Local Finance Division will be providing your municipal Treasurers and Clerk-Treasurers with further details on the 2016 OMPF.  This information and other supporting materials will be posted in both English and French on the MOF website:

http://www.fin.gov.on.ca/en/budget/ompf/2016  

We are also pleased to continue our commitment to the phased upload of Ontario Works (OW) benefits and court security and prisoner transportation costs. This builds on the Province's previous uploads of Ontario Drug Benefits (ODB) and Ontario Disability Support Program (ODSP). 

As a result of the uploads, municipalities will benefit from more than $1.8 billion in reduced costs in 2016 alone. Combined with the OMPF, this is the equivalent of 13 per cent of municipal property tax revenue in the province.

Despite the phase-down of the OMPF, our commitment to the provincial uploads means that overall support to municipalities will continue to increase, with the provincial uploads more than offsetting the reduction to the program.

Our government has a very strong record of supporting and working with municipalities.  In 2016, municipalities will benefit from more than $3.8 billion in ongoing support through the OMPF, provincial uploads, and other provincial initiatives – an increase of $2.7 billion from the level provided in 2003.

Our significant investments in municipal infrastructure are supporting communities across Ontario.

Ontario is making the largest infrastructure investment in Ontario’s history with more than $130 billion over ten years. These investments will benefit municipalities across the province, whether it’s a new school, repairs to provincial highways or funding to help a municipality make critical repairs to a local bridge.

Included in this plan is Moving Ontario Forward – the Province’s plan to invest $31.5 billion in transit, transportation and other priority infrastructure across Ontario over ten years. As part of Moving Ontario Forward, the permanent $100 million per year Ontario Community Infrastructure Fund (OCIF) is supporting the revitalization and repair of roads, bridges and other critical infrastructure in small, rural and northern communities. Also included as part of this plan is the $15 million annual investment for the new Connecting Links program beginning in 2016.

We look forward to continuing to work with our municipal partners to ensure the design of the OMPF continues to reflect the long-term priorities of municipalities.

Sincerely,

Information copy
Original signed by

Charles Sousa
Minister
Ministry of Finance

Information copy
Original signed by

Ted McMeekin
Minister
Ministry of Municipal Affairs and Housing