MONTREAL - As the Caisse de dépôt et placement du Québec (CDPQ) continues to rush to its metropolitan power grid (REM - an electrical public transporation system for Montreal and area) project, the Canadian Taxpayers Federation (CTF) is raising the alarm about the unforeseen consequences of this project on Quebec and Canadian taxpayers and on the public finances of governments and municipalities. (Visual simulation of REM YouTube Capture/CDPQ infra)
The clues to this effect are accumulating and increasingly worrying taxpayers. From the outset, it has become clear that the project will not be possible without the financial participation of the various levels of government, contrary to what was promised at the time of the initial announcement. The Caisse stated in its press release: "To the extent that the Caisse assumes ownership and control of projects, their impact on Québec's public finances is minimized, since these infrastructures are excluded from the government's balance sheet. Only Quebec's financial contribution could be included in the balance sheet if the government decided to make one."
However, the project is now estimated at $5.9 billion, almost double what was originally planned, and the Caisse now requires the various levels of government to finance the EMN with billions.
"There is no doubt that the metropolitan power grid project is exciting," said CTF director Victoria Vallée. "That being said, we are moving further and further away from what was originally promised financially. Negotiations between Québec, Ottawa and the Caisse continue in the shadows without informing taxpayers about the consequences on their already over-taxed wallets. "
Cities in the Montreal region are also expected to incur a bill of approximately $300 million over the next few years to offset the projected increase in transmission system costs and the arrival of the Metro.
The Caisse is also considering a new mechanism, namely, the capture of land value surplus (property tax) to finance the project, a mechanism that is causing concern to several municipalities in Québec because it would use their main source of income.
"The Caisse and governments must do their utmost to minimize the unfortunate consequences that the EMN may have on the Quebec and Canadian taxpayers' portfolio already bled, and they must be more transparent about the real effects that the project will have on our public finances. "
That's not all. In addition to financing the project with - potentially - their taxes and property taxes, Quebeckers could also be asked to contribute through Hydro-Québec's inflated electricity bills. The government acknowledged that the Crown corporation could fund the EMN to the tune of $300 million.
"The consequences of the EMN on other transit services are another question mark that could have a huge impact on our public finances," concluded Mr. Vallée. "Will it be the taxpayers who will ultimately finance the returns of the Caisse de dépôt et placement du Québec through this megaproject? In the light of the information and uncertainties we have gathered, it is legitimate to ask the question.