OMAFRA owes Perth South $140,000 in drain grant funds
At the Perth South Council meeting on May 17, Treasurer Rebecca Clothier presented a report she had prepared for Council, outlining the municipal drainage work completed in the Township during the 2015 fiscal year and the associated costs, as well as the money owed to them by the province.
“During the 2015 fiscal year construction/improvement work was completed on nine municipal drains with a total cost of $163,076.52,” wrote Clothier in the report. She noted Tuesday that there was “a lot less” drainage work done in 2015 than in 2014, but they would “probably be doing a lot more in 2016 based on all of the drains we see coming forward.”
Somewhat surprisingly, at year’s end on Dec. 31, 2015, the province owed more money to Perth South through the Agricultural Drainage Infrastructure Program than the township had spent on drains in 2015. The Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) provides a grant of up to one-third of the cost of maintenance, repair, improvement and construction of drains on qualifying lands such as farmland, Clothier wrote.
At the end of 2015, Perth South was owed $228,488.91 from the province, Clothier told Council. That figure consisted of eight projects, including one dating back to April 2012 worth over $59,000.
This past February, grants for two projects that had been owing were paid, reducing the amount to about $140,000 which the province still owes the township, Clothier said. “However, there is still a grant outstanding from 2012 that I’ve followed up on numerous times and I’ll have to follow up on again,” she said. “I don’t understand why they’re not paid in order.”
Mayor Bob Wilhelm called the numbers “surprising,” while Coun. Stuart Arkett commented that it seems as though somehow the 2012 grant had gotten “lost in the shuffle.”
“I have followed up with [the Ministry] before,” Clothier said, adding that she was also concerned the 2012 grant had been skipped over. “I never did get a written response to my letter, or anything I asked for. I can have a verbal discussion, but I don’t seem to get anything in writing.”
The only message she seems to be getting from OMAFRA is that they don’t have any money budgeted for these grants, Clothier said. “When we have construction projects like these, and it’s all approved and ready to go, I send OMAFRA a notification that we have a project coming forward, it’s expected to be completed by this date, and this is the amount of grant that we’re expecting to require,” she said. “They’re supposed to write me back and tell me whether or not there’s money in the budget. I haven’t received one of those letters since 2013… They won’t tell us whether or not they have the money.”
She said that, in discussions she’s had with OMAFRA, they’ve informed her that, “when they get a new budget, they’re back-paying.”
“They’re several years behind,” she said. “They used to generate surpluses, and that surplus money was used for more grant funding. Now they’re not generating surpluses. So, the pool of money is short.” There are a lot of municipalities that are fighting for the same pool of money on a ‘first come, first served’ basis, she said.
In the ‘Financial Implications’ section of her report, Clothier wrote that “due to the timing difference between the costs being incurred by the municipality and the recovery of costs from land owners and other government bodies, the municipal drainage work has impacted the Township’s cash flow.”
This led Council to consider changing how those petitioning for a drain are billed.
“Why wouldn’t we bill them out, not on the assessment schedule, which reflects the one-third grant, but based on the total cost of the thing, and then when [the grant] comes in, just pass it off?” asked Coun. Arkett.
Clothier said Council had considered that option in the past, adding that some municipalities currently operate their drainage billing system in that way. “Council could say, ‘we’re not going to pay the grant portion, we will bill you the entire amount and if and when we get the grant, we’ll send you back a cheque,” she said.
As it stands now, if a grant doesn’t come through, property owners are billed for the grant portion, she said.
“If there’s precedent for it, we should be billing out the full amount,” Coun. Arkett said. “Insurance companies will do that, if you’re going to make a claim.”
Clothier said she would prepare a report on how the changed policy would work for Council’s next meeting on June 7.