Nova Scotia, feds, sign new 10-year, gas tax agreement worth close to $600 million

Braedon Clark
Published on July 4, 2014

Justice Minister Peter MacKay, left, and Premier Stephen McNeil at Thursday's announcement at Pier 21 in Halifax.

©Braedon Clark - METRO HALIFAX


Nova Scotia municipalities can count on the flow of federal gas tax dollars for at least the next decade after an agreement was signed in Halifax on Thursday.

Justice Minister Peter MacKay signed the agreement, set to run through 2023-24, with Premier Stephen McNeil at Pier 21. Both spoke highly of how the 10-year, $580 million deal will help their home province deal with its infrastructure issues.

“The funding will flow directly to communities,” MacKay said. “These are the types of issues I hear about when I talk to mayors.”

“This is significant from a planning point of view,” McNeil said. “The municipalities know the money will be there for years so it allows them to make plans they couldn’t have before.”

In the 2014-15 fiscal year, the gas tax will amount to $53 million, a slight decrease from last year due to the declining provincial population. The transfer amount is based on census data and could change when the next census is taken in 2016.

The list of projects that can receive gas tax funding has also expanded and includes everything from roads and bridges to projects supporting culture, tourism and sport.

Kentville Mayor Dave Corkum, president of the Union of Nova Scotia Municipalities, said that the funding is a critical source of support for communities that are often cash-strapped.

“This is much-needed, stable funding for all municipalities,” Corkum said, adding gas tax dollars have been used in Kentville for flood mitigation and trail development.

Gas tax transfers will now also be indexed by two per cent, meaning they will likely keep pace with inflation over the 10 years of the agreement.

While the announcement was largely a good news event for the province, McNeil acknowledged federal funding alone won’t be able to solve the province’s infrastructure needs.

“No question,” he said when asked if municipalities need more assistance.

Even so, McNeil made it clear that the long-term nature of the new deal would be a major help as municipalities plan for an always uncertain future.