Up-front multi-year funding

Green Municipal Fund (GMF)

March 31, 2000

Ongoing

Energy Efficiency

The GMF is a revolving fund administered by the Federation of Canadian Municipalities (FCM). The GMF supports grants, loans, and loan guarantees to encourage investment in environmental municipal projects.  The Government of Canada endowed the FCM with a total value of $675 million for this initiative through a series of budget decisions beginning in 2000 through to 2016.

The GMF was established to enhance Canadians’ quality of life by improving air, water, and soil quality, and protecting the climate. Eligible projects may fall into one or more of the following categories: brownfields, energy, transportation, waste, and water. Projects may take the form of plans, feasibility studies, pilot projects, and capital projects.

The amount of GMF financing available for municipal projects is directly related to the environmental benefits or innovativeness of the project, while taking into account economic and social considerations. Grants of up to 50% of eligible costs are available for plans and studies to a maximum of $175,000. For pilot projects, grants up to 50% of eligible costs to a maximum of $350,000 are available. Low-interest loans of up to 80% of eligible costs are available for capital projects, to a maximum of $5 million or $10 million for high-ranking projects, typically combined with a grant amount for 15% of the loan amount, to a maximum of $750,000, or $1.5 million for high-ranking projects.

As stipulated in the GMF Funding Agreement between the FCM and the Government of Canada, the FCM has created two advisory bodies: the GMF Advisory Council and the Peer Review Committee. The GMF Council’s role is to assist the FCM Board of Directors, the decision-making body for the GMF, in approving projects proposed by municipalities. The fifteen member GMF Council includes five federal members: two from Environment and Climate Change Canada (ECCC), two from Natural Resources Canada (NRCan) and one from Infrastructure Canada (INFC). All federal members are appointed by the FCM Board of Directors based on body for the GMF, in approving projects proposed by municipalities. The fifteen member GMF Council includes five federal members: two ECCC, two from NRCan, and one from INFC. All federal members are appointed by the FCM Board of Directors based on recommendations from the Minister of the ECCC or the Minister of NRCan.

In September 2019, Ernst and Young delivered the report for a five-year performance audit of the GMF covering the period from April 1, 2014 to March 31, 2019. The audit found that the GMF is economic, efficient, and effective with regard to its objectives. Specifically:

• The GMF is appropriately structured to achieve its objectives.
• Application, disbursement and monitoring processes are effective and efficient in ensuring projects are consistent with the GMF’s objectives.
• Mechanisms exist to help ensure sustained funding and support for the GMF’s continued operations.

GMF management has access to adequate information and data systems to enable effective and efficient program administration.

Ernst and Young also performed a five-year review assessing the GMF’s relevance and outcomes, and delivered the report in September 2019. Overall, the GMF was found to be performing well, with a survey of funding recipients and non-recipients indicating strong client satisfaction. Over 65% of respondents indicated that GMF funding is critical to the completion of municipal projects, and over 70% indicated that GMF knowledge services and products are highly valuable to municipalities. The review identified some opportunities for improvement (e.g., tools and strategies for knowledge sharing) but indicated that FCM staff had proactively identified many of those opportunities and improvements were underway.

A horizontal evaluation (ECCC lead) is planned for 2021-22.

Since its inception, FCM has protected the initial endowment and approved 1,310 municipal sustainability initiatives. Funded projects have avoided GHG emissions of 2.6 million tonnes, created energy savings of 853,045 GJ per year and resulted in $897.5 million in national GDP.

The 2018-19 Annual Report was published in August 2019 and is currently available on the FCM website. The 2019-2020 Annual Report is expected in August 2020.

$337,500,000

$0

$950,000,000

$950,000,000

$950,000,000

Explanation of variances

Budget 2019 announced a new investment of $950 million from NRCan for the GMF to further energy efficiency in the built environment.