<html> If the rest of this message is blank, please go to <a href="http://www.greenontario.org/" eudora="autourl">www.greenontario.org</a> for the newsletter... <div align="center"> Green On. The Online Newsletter of the Conservation Council of Ontario see <a href="http://www.greenontario.org/" eudora="autourl">www.greenontario.org</a> for the online version and to subscribe or unsubscribe Budget 2004: Conservation Accounting Makes Inroads Chris Winter, Executive Director May 19, 2004 </div> There was no single big green announcement in yesterday’s Ontario budget, but there were a whole bunch of little things that add up to nearly a billion dollars in green investments.  There are also a number of interesting trends in fiscal management and strategic planning that will have a significant potential for conservation and the environment. --- Infrastructure Commitments --- This is the green infrastructure budget  with water and transit getting significant new commitments.  Ontario’s crumbling infrastructure is a major concern and the government has committed a total of $3.3 billion to infrastructure investments.  Of this, $346 million goes to water and $448 million goes to transit.  $992 million still goes to fixing and expanding highways, which is twice the commitment to transit, however the funding trend is clearly moving away from highways. --- Electricity --- The budget was silent on the other major infrastructure question  electricity.  There’s not much in the way of financial commitments to report in the electricity sector  just tax breaks on clean home energy sources and energy efficient appliances that will cost about $11 million.  No commitment was made with respect to the funding required to replace Ontario’s electrical infrastructure.  Here’s why: the consumer is going to pay, not the taxpayer. --- Conservation Accounting --- Page 31 of the budget papers outlines the fiscal implications of the government’s electricity sector reforms.  Here you’ll see the first signs of “conservation accounting”  paying full cost for resources and creating direct links between consumption taxes and the conservation alternative.  The budget reiterated the commitment to move to a “consumer-pays” system for electricity and away from the traditional “taxpayer-pays” approach. The new approach will provide a tremendous incentive for conservation. The other example of conservation accounting in the budget is the commitment to link two cents of the gas tax to transit funding.  This is perhaps the best example of using a pollution/consumption tax to directly subsidize a low-pollution/conservation alternative. “Conservation and sustainability of resources” was one of four key strategies outlined in the Town Hall consultation process.  Clearly, the government is moving ahead with pricing as an alternative revenue generating option, a cost-recovery mechanism for infrastructure investments, and as a key tool to promote conservation and the efficient use of scarce resources.  With the one caveat of needing to protect low-income groups from price spikes, this is an excellent initiative that will help promote a conserver society, an efficient and competitive economy, and sound fiscal management. --- Gas Tax --- The Province has made good on the commitment to transfer two cents of the gas tax to municipalities to help pay for public transit.  One cent will dedicated beginning October 2004.  This will increase to 1.5 cents in October 2005 and 2 cents in October 2006. --- Natural Areas --- Natural areas protection got a small boost with the extension of the tax exemption for conservation lands to cover lands of natural and environmental significance owned by conservation authorities and land trusts (an estimated $1million program). --- Funding up for Green Ministries  up $50 million --- <dl> <dd>·<x-tab>       </x-tab>Ministry of Environment $260 million to $304 million (+44) </dl>·<x-tab>       </x-tab>Ministry of Energy $118 million to $137 million (+19) ·<x-tab>       </x-tab>Ministry of Natural Resources dropped from $518 million to $505 million (-13), but still remains higher than the 2000 to 2003 levels. --- Four-Year Plans --- The other interesting development is that the government is replacing  “ministry business plans” with a four-year plan based on clear provincial objectives and with six-month progress reports.  The emphasis will be on planning for results.   Unlike the former business plan process (where consultation came six months after the plans were finalized), the government intends to hold consultations throughout the entire process  from setting priorities to reviewing the results. One thing that is not clear is how the Statements of Environmental Values (SEVs) under the Environmental Bill of Rights (EBR) will fit into the new approach.  The EBR requires that ministries consider their SEVs in all new initiatives.  (Readers will no doubt recall the detailed “Missing Values” reviews of ministry business plans conducted by the CCO  <a href="http://www.greenontario.org/cco/publications.html" eudora="autourl">www.greenontario.org/cco/publications.html</a>.) The government needs to update the thirteen ministry SEVs ASAP if they are going to have relevance within the new planning regime. --- Red Tape --- The Red Tape Commission will be converted into a small business agency.  Not much more needs to be said about this one. --- Horse Sense? --- Finally, every budget usually has something that’s just downright wacky.  The dance around lotteries and gaming revenue is always interesting  trying to justify how gambling is a social good.  Of the total gaming revenue of $2,117 million, hospitals get 1,474 million (70%), $512 million (24%) goes into “general government priorities”, problem gambling gets 36 million (1.7%) and the Ontario Trillium Foundation gets $95 million (45%).  Trillium is the largest single source of funding for voluntary sector environmental projects in Ontario, with a budget of $10 million for the environment sector.  At the same time, $299 million (20% of the gross revenue from slot machines at racetracks) goes to support Ontario’s horse racing industry.  Compare this with, say, the budget commitment of $13.4 million for affordable housing. In Ontario, horses are getting better far better treatment than the homeless. <div>***************************</div> <div>Promoting conservation leadership, cooperation, and action for over 50 years</div> <div>The Conservation Council of Ontario</div> <div>43 Sorauren Avenue, Toronto, Ontario M6R 2C8</div> <div>(416) 533-1635</div> <div><a href="http://www.greenontario.org/" EUDORA=AUTOURL>www.greenontario.org</a> </div> <div>Chris Winter, Executive Director</div> </html>