Municipal politicians endorsed a report Wednesday that calls on local governments to help grow the province's economy and then share in the gains.
The report, Strong Fiscal Futures: A Blueprint for Strengthening BC Local Governments’ Finance System, proposes to establish an "infrastructructure and community development bank" through which municipalities and regional districts would "receive a guaranteed share in improved provincial economic growth."
It includes an appendix showing how much local governments would have collectively gained if they received 10 per cent of actual provincial revenue growth above two per cent and 25 per cent of such growth above three per cent.
Over 11 years beginning with the 2000-01 fiscal year, they would have received $2.4 billion under the two-per-cent growth and 10-per-cent share scenario and $2.1 billion under the three-per-cent growth and 25-per-cent scenario.
The proposal would give local governments "an incentive to be an active partner in developing that economy," said Cariboo Regional District chair Al Richmond in a teleconference with media at the Union of British Columbia Municipalities convention.
Richmond, who co-chairs the UBCM's select committee on local government finance, said the funds could be used to upgrade infrastructure during times when the economy is booming.
Prince George councillor Cameron Stolz, who chairs the city's finance and audit committee, welcomed the proposal.
"I think it's a fantastic idea and more importantly, it was unanimously endorsed by the membership of the UBCM," Stolz said in a telephone interview from Vancouver where the conference is being held.
He said asking for a larger share of existing provincial government revenue is not practical.
"That's the key piece, that our ask isn't for existing money and saying 'let's rob the money from Peter to pay Paul,'" Stolz said. "What we're looking for here is 'let's be partners moving forward so when there is good economic growth, above three per cent, that revenue is then shared with the municipalities to deal with core infrastructure needs."
The report is critical of local government's ongoing reliance on property tax, saying it neither grows with the economy nor distributes costs fairly.
With the cost of infrastructure upgrades expected to be in the billions over the next 10 to 15 years, property tax bills will continue to climb, the report warns, "to levels where the weaknesses of the property tax system will make the cost unacceptable for many British Columbians."
Stolz said the report highlights the challenge communities face in maintaining and upgrading their water, sewer and roads.
"We can't handle that bill by ourselves and we have to come up with other creative ways of finding funding for that," he said.
In 2012, staff estimated the city faced an annual $3.7-million shortfall in the spending needed to maintain Prince George roads and, in addition, the shortfall for the water system is $4.3 million, for the sanitary system it's $2.1 million, for the storm sewer system it's $1.3 million and for sidewalks it's $860,000.