Up-front multi-year funding

The GMF is a revolving fund administered by the Federation of Canadian Municipalities (FCM). It provides municipalities and municipal partners with grants, loans, and loan guarantees to encourage investment in environmental municipal projects. The Government of Canada endowed the FCM with a total value of $1,625 million^{Footnote 1} for this initiative through a series of budget decisions beginning in 2000 through to 2019. Of that investment, FCM is responsible for maintaining a nominal value of $1,012.5 million for the GMF endowment.

The GMF was established to enhance Canadians’ quality of life by improving air, water, soil quality, and protecting the climate. Projects may take the form of plans, feasibility studies, pilot projects, and capital projects. Eligible projects under the GMF Core Offer may fall into one or more of the following sectors: brownfields, energy, transportation, waste and water. The Signature Initiatives offer supports to innovative projects that do not fit these categories. Through new funding in 2019, three new funding streams have been launched under the GMF to support greater energy efficiency and greenhouse gas reductions: Sustainable Affordable Housing; Community Efficiency Financing; and Community Buildings Retrofit. The GMF also supports a network of seven Low Carbon Cities Canada (LC3) climate centres in major cities across Canada and will provide those centres with $177 million in grants to establish endowments.

The Funding Agreement allows GMF to provide grants and loans for municipal projects totalling between $62 and $182 million in a given year. The amount of funding available for any one project is directly related to the environmental benefits or innovativeness of the project, while taking into account economic and social considerations. For the carrying-out of studies, assessments, sustainable community plans, and pilot projects: grants up to eighty percent (80%) of Eligible Project Costs are available. For the execution of any other Eligible Projects where environmental, economic or social benefits are deemed to be exceptional, as defined by the FCM Board of Directors on the recommendation of the Council: grants, loans (at fixed interest rates no lower than the Government of Canada bond rate for equivalent terms up to thirty (30) years minus two percent (2%)) and/or loan guarantees to an Eligible Recipient in respect of an Eligible Project may, in combination, be up to (80%) of Eligible Project Costs. For greater certainty, for the purposes of these exceptional circumstances, the value of the grants shall not exceed fifty percent (50%) of Eligible Project Costs.

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 eighteen member GMF Council includes six federal members: two from Environment and Climate Change Canada (ECCC), two from Natural Resources Canada (NRCan), one from Infrastructure Canada (INFC) and one from Canada Mortgage and Housing Corporation (CMHC). All federal members are appointed by the FCM Board of Directors based on recommendations from the responsible Minister.

No evaluations in 2020-21.

Horizontal evaluation of Green Municipal Fund planned for completion in March 2022 (Environment and Climate Change Canada lead).

Since its inception, FCM has protected the initial endowment and approved 1,360 municipal sustainability initiatives. Funded projects have avoided GHG emissions of 2.75 million tonnes, created energy savings of 860,218 GJ per year and resulted in $1.1 billion in national GDP.

The 2019-20 Annual Report was published in September 2020 and is currently available on the FCM website. The 2020-2021 Annual Report is expected in August 2021.