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Bill 38: An innovative solution to finance strategic infrastructure projects

Montréal, May 20, 2015 – The Board of Trade of Metropolitan Montreal submitted its brief yesterday supporting the legislative text and principles found in Bill 38. During its presentation to the Parliamentary Committee as part of special consultations for the bill, the President and CEO of the Board of Trade, Michel Leblanc, argued that it offered an appropriate, innovative solution that responds to the need to develop strategic infrastructure without increasing Quebec’s debt load.

“Bill 38 presents an interesting avenue for funding and completing new infrastructure projects, while limiting the Government of Quebec’s financial contribution,” Michel Leblanc said. “By giving the Caisse de dépôt et placement du Québec the legal capacity to invest in infrastructures projects that are strategic for the city’s development, the government is equipping Quebec with an invaluable financing tool.”

“Major infrastructure and public transit projects need to go ahead to improve the movement of people and merchandise,” Mr. Leblanc said. “Traffic problems are costing the city’s economy $1.8 billion every year. We need to provide the new Champlain Bridge, the western part of Montréal and Montréal-Trudeau Airport with a modern, efficient public transit system.”

Creating a clear governance framework and contract terms

“For the agreement to work, it is important that roles be clearly defined between the Government of Quebec and the Caisse,” Michel Leblanc said. “While it is up to the government to set the overall vision of public infrastructure needs and to safeguard the public interest, the Caisse has to remain completely independent. Any government intervention in the Caisse’s decision making would not only compromise the effectiveness of the partnership, it would also hurt its reputation as an independent entity, and this would affect its ability to act as a financial partner for major investments.”

“This public-public partnership will provide the Caisse with potentially attractive returns from investments in major infrastructure projects, similar to the approach used in other places,” Michel Leblanc said. “As far as the two projects are concerned, it will be interesting to evaluate the potential of different sources of financing such as land value capture, a solution that is underused when it comes to financing public transit projects. But given the precarious finances of municipalities, we need to ensure that land value capture collected by the Caisse does not reduce the potential revenue of cities that are home to the projects.”

“Furthermore, while the Caisse will determine the method of financing and the rate levels required to complete the projects, we need to ensure that rates are consistent with the rest of the city’s public transit network,” Michel Leblanc said.

The Board of Trade’s recommendations are as follows:

  1. Move ahead with the bill, because it makes it possible to create strategic public transit infrastructures for the city.
  2. Clearly define the role of key players, and above all ensure that the spirit and the letter of the law give the Caisse de dépôt et placement complete independence.
  3. Ensure efficiency and transparency in completing public transit infrastructure projects covered by the bill.
  4. Ensure consistency across the city in planning transportation projects and require that the agreement encourage an integrated rate structure consistent with rates for other public transit equipment and networks in Greater Montréal.
  5. Agree ahead of time on the method of financing and specifically on land value capture.
  6. Word the bill so that it takes into account other types of infrastructure projects that could be proposed by the government for analysis by the Caisse de dépôt et placement.

To consult the Board of Trade’s brief, please click here.

About the Board of Trade of Metropolitan Montreal

The Board of Trade of Metropolitan Montreal has over 7,000 members. Its mission is to be the voice of Montréal’s business community and to promote the city’s prosperity. It is involved in key areas of economic development, advocating a philosophy of action based on engagement, credibility, proactivity, collaboration and innovation. The Board of Trade also offers a range of specialized services to individuals and to business of all sizes to support them in their growth at home and abroad.


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Michelle LLambias Meunier
Advisor, Media Relations
Board of Trade of Metropolitan Montreal
Tel.: 514 871-4000, ext. 4042
Twitter: @chambremontreal
Follow the discussion: #ccmmqcca

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