Comparing BC's Gas Tax Fund with Other Provinces, Territories

British Columbia was the first jurisdiction in Canada to negotiate a Gas Tax Agreement (GTA) with the federal government.  As a result there are a few features about BC's agreement that are unique.  The vast majority of BC's GTA, though, mirrors agreements in other jurisdictions, particularly in the area of eligible and ineligible costs.

Eligible and Ineligible costs for the Gas Tax Program

As part of the terms and conditions of the GTA, eligible and ineligible costs reflect federal priorities as the provider of funding to the program, and are consistent for agreements in all provinces and territories.

For example, all Gas Tax agreements in Canada require that in order to be eligible, all capital projects must result in a tangible capital asset in the applicable province/territory, primarily for public use or benefit, and owned by an Eligible Recipient.  In addition, all agreements require that the project must improve the quality of the environment, and contribute to reduced greenhouse gas emissions, clean water or clean air.

The list below represents some of the eligible and ineligible costs that are consistent for all Gas Tax agreements as the result of federal terms and conditions.

Eligible Costs include:
  • Capital costs of acquiring, constructing or renovating a tangible capital asset and any debt financing chargers related thereto;
  • Fees paid to professionals, technical personnel, consultants and contractors, specifically engaged to undertake the surveying, design, engineering, manufacturing or construction of a project infrastructure asset, and related facilities and structures; and,
  • Cost of environmental assessments, monitoring and follow-up programs, as required by the Canadian Environmental Assessment Act or a provincial equivalent.
Ineligible costs include:
  • Land acquisition;
  • Legal fees;
  • Feasibility and planning studies for individual capital projects;
  • Use of recipient's own employees or equipment;
  • Routine repair and maintenance;
  • Operating and administrative costs, and costs related to planning, engineering, architecture; and,
  • Supervision, management and other activities normally carried out by staff.
Those familiar with the administration of other federally funded programs, like the Building Canada Fund, will recognize that the eligible and ineligible costs of the GTA are also consistent with the terms and conditions of these other programs.

In light of the federal government's consistency with regard to eligible and ineligible costs, it is assumed that even with the expansion of project categories in a renewed Gas Tax Fund, costs associated with legal fees, land acquisition, routine repair and maintenance, and operational costs will continue to be ineligible here in British Columbia, and everywhere across Canada.

The differences in BC's GTA primarily relate to how the funds are delivered through a combination of allocated and application based funds.  The program delivery model for the GTA in BC will be the subject of a future article in The Compass.

For more information about any of the Gas Tax funded programs – or to access a full list of eligible and ineligible costs – please visit our website or give us a call at 250-356-5134.

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