Month: April 2019

Credit ratings agency Fitch has an unpleasant welcome gift for Ontario Premier-designate Doug Ford: A downgrade to the province’s credit outlook.

Fitch announced Friday it’s maintaining its “AA-” credit rating for the province, but is downgrading the future outlook to “negative” from “stable” on account of Ontario’s return to deficit spending — a trend started under Kathleen Wynne’s Liberals, but one that will continue under Ford.

If the negative outlook were to lead to a lower credit rating, Ontario could face higher borrowing costs, making its budget problems worse. Fitch says it could downgrade the province’s credit rating if the incoming Progressive Conservatives were to signal an “extended” period of deficits ahead.

After working for years to bring Ontario back to balanced budgets after the Great Recession of 2008-09, the provincial Liberals announced a return to deficit spending in this year’s budget, ahead of the spring election.

“The departing government’s tabled 2018 budget for fiscal 2019 forecast a return to annual deficits financed by debt issuance, a trajectory that appears likely to remain in place by the incoming PC party,” Fitch said in a statement.

“This change in fiscal plans is the reason for the outlook’s revision to negative.”

Watch: Things to know about Ontario’s next premier, Doug Ford (story continues below)

Ford’s provincial Progressive Conservatives didn’t promise an immediate return to balanced budgets, saying only they would get back in the black within three or four years. The party released an un-costed platform, making it difficult to determine what impact their promises would have on the budget.

In his campaign, Ford vowed a number of tax cuts, including a 20-per-cent reduction in taxes for those earning between $42,960 and $85,923, and a 10-cent-per-litre reduction in gas prices. Those measures are expected to cost the budget $3.5 billion per year in lost revenue.

Ford has said he would cover the shortfall by finding “efficiencies” within government, though he has not specified what those might be.

“As additional details on the incoming Progressive Conservatives’ fiscal priorities become available, the size of future annual deficits and the means of financing them, as well as the time frame by which the province will return to fiscal balance, will be significant to resolution of the negative outlook,” Fitch said.

The agency said if the PCs’ plan includes a lengthy period of deficits, it could mean a downgrade for the province’s credit rating.

DOON, Iowa — A freight train derailed in northwest Iowa on Friday, leaking crude oil from into flooded fields flanking the tracks and raising concerns about the possible contamination of residential water supplies downstream, officials said.

BNSF railroad spokesman Andy Williams said no one was injured when 33 oil tanker cars from Alberta, Canada, derailed around 4:30 a.m. Friday just south of Doon in Lyon County. Some of the tankers were compromised, causing the oil to leak into floodwaters and eventually into the rain-swollen Little Rock River, but officials didn’t have an exact number of tankers that leaked oil by late Friday afternoon, Williams said.

BNSF had hazardous materials and environmental experts on the scene and had begun cleanup within hours of the derailment, Williams said.

“We are containing the oil that was spilled as close to the incident as possible using containment booms and recovering it with skimmers and vacuum trucks,” he said.

Williams said he did not immediately know the train’s destination.

Lyon County Sheriff Steward Vander Stoep said between 30 and 40 semitrailers containing cleanup equipment had arrived at the scene near Doon, Iowa, by Friday afternoon.

Officials at the scene agreed that floodwater from the swollen Little Rock River played a part in causing the cars to leave the tracks, but said they weren’t yet sure whether the waters compromised the track, physically pushed the cars off it or played a part in some other way. The river rose rapidly Wednesday after 5 to 7 inches (13 to 18 centimetres) of rain fell Wednesday and a further downpour on Thursday.

A broadening sheen of oil spread near several of the tankers, which had piled up across the track and earthen berm, some submerged in the water.

Vander Stoep said that drinking water in Doon and the immediate area didn’t seem to be in danger of contamination.

But news of the spill was enough to prompt officials in Rock Valley, a small city about 5 miles (8.05 kilometres) southwest of the derailment, to shut off all the city’s drinking water wells. The water towers also will be drained as a precaution, said Rock Valley public information officer Travis Olson. In the meantime, the city is getting its water from the nearby Rock Valley Rural Water system, which Olson said is not in danger of being contaminated by the spill.

The city, with a population of nearly 3,400, will stay on the rural water system until testing by the Iowa Department of Natural Resources confirms the safety of the city’s drinking water, Olson said.

“I don’t know how long that will be,” he said. “It sounds like the cleanup is going to take a while.”

Williams said he was unsure how much oil leaked and how many of the cars were leaking. Lyon County Sheriff Stewart Vander Stoep said the oil was being carried downstream into the Rock River a few hundred yards west of the derailment.

No information was immediately available on how much oil each of the tankers was carrying. Cleanup crews were dispatched to the site.

Vander Stoep said four homes near the site were evacuated.

The Rock River had already carried some oil to Rock Valley by midmorning, said Ken Hessenius with the Iowa Natural Resources Department. State crews were trying to determine how fast the oil was travelling south. The Rock River joins the Big Sioux River before merging into the Missouri River at Sioux City.

The task difficulty is compounded by the spreading floodwater, he said.

“The river, instead of being 100 yards wide, is now maybe a half-mile wide” in spots, Hessenius said.

“Our first major concerns are public water supplies,” he said, adding that several towns that draw water from shallow wells near the Rock River have been alerted about possible contamination.

Doon is about 40 miles (65 kilometres) southeast of Sioux Falls, South Dakota, where several rain-swollen rivers overflowed Thursday. The National Weather Service has forecast flooding in the area into the weekend.

OTTAWA — Parliament’s spending watchdog says the Liberals are slipping further behind on their infrastructure program, noting in a new report that only half of the $14.4 billion earmarked for the first phase of the infrastructure plan has been set aside for projects.

The report also warns that while there have been some economic gains from spending, those benefits the Liberals once touted for the spending may not be fully realized.

The parliamentary budget office’s report says the slippage in spending is likely to affect the budgetary balance sheet by reducing planned deficits in one year at the expense of deeper spending in future years.

Parliamentary budget officer Jean-Denis Frechette’s office found 10,052 projects with a combined cost to federal coffers of $7.2 billion have been approved for funding across 32 departments, agencies and Crown corporations since 2016, when the Liberals unveiled the first phase of their infrastructure program,.

That still leaves $7.2 billion to be allotted for projects that the Liberals had hoped would be underway or done by now.

Infrastructure Minister Amarjeet Sohi said the report was not a complete picture of the government’s spending because officials didn’t provide enough information to Frechette’s office.

‘We’re going to deliver every cent’

The government should have some more information by the weekend: Sohi said the government has set a deadline of Saturday for provinces and territories to identify how they plan to spend phase one money he oversees for water and transit projects.

“Every single cent of that $14 billion is committed to programs and is committed to our communities and we’re going to deliver every cent of that,” Sohi said.

Frechette’s concerns about the pace of federal infrastructure spending have been a thorn in the Liberals’ side for more than a year as his office has repeatedly raised questions about delays. His latest report arrives as the Liberals will miss a self-imposed deadline to sign funding deals by the end of March with all provinces and territories for $33 billion in upcoming spending. Two more agreements are to be signed next week.

Federal coffers are set to dole out $186.7 billion in infrastructure money over the next 12 years, but the most recent federal budget indicated about one-quarter of planned spending between 2016 and 2019 was being moved to future years.

Tories, NDP blast inaction

NDP infrastructure critic Brigitte Sansoucy said Frechette’s report confirms the Liberals can’t deliver on their promises. The Bloc Quebecois lamented the disparity in per capita spending that saw Quebec at the bottom of the pack while more money per capita was invested in smaller provinces.

Conservative infrastructure critic Michael Chong said the report reflected a pattern of mismanagement on the infrastructure file, with money not being spent or allocated on time. He said the Liberals promised a solution to this issue during the 2015 election, saying that any uncommitted infrastructure funds would be moved to the gas tax fund that funds work in cities.

“And they’re not doing it,” he said.

“That was their proposal to deal with the problem. They made a half-hearted attempt at it last year and they’re not committing to it this year.”

The Liberals sold the first of their infrastructure program by saying that the money, $11.3 billion of which was committed on a cash basis between April 2016 and this Saturday, would grow the economy by 0.2 per cent in the first 12-months and then by 0.4 per cent in the ensuing 12 months.

The parliamentary budget office estimates spending to date has boosted the economy by 0.1 per cent in each fiscal year and added between 9,600 and 11,100 jobs over the last 12 months.

But the estimates came with a caveat: Almost half of the projects the PBO reviewed didn’t have identifiable start dates, making it tough to determine the “actual timing and magnitude of their economic impact,” the report says.

Frechette’s report says rising interest rates could wipe out any economic gains by the end of March 2022.

TORONTO — Lawyers for CTV News say the network did nothing wrong in reporting allegations of sexual misconduct against the former leader of Ontario’s Progressive Conservative party.

In a statement of defence served to Patrick Brown, CTV denies allegations laid out in a defamation lawsuit the former Tory leader launched in April. The statement was first published Saturday by the website Canadaland.

In his statement of claim, Brown alleged the network and several journalists involved in the story acted maliciously and irresponsibly in publishing what he characterizes as false accusations brought forward by two women.

Lawyers for CTV deny those allegations and say Brown is not entitled to the $8 million in damages he is seeking.

“The Named Defendants explicitly deny that the words complained of were falsely and maliciously broadcast or published,” the statement of defence says.

The legal battle comes months after CTV News aired its initial report about the alleged misconduct, which prompted Brown to step down from his post as head of the provincial Tories.

A lawyer for Brown said Saturday he looks forward to “pursuing this litigation on behalf of Mr. Brown and to further his efforts to vindicate his reputation and seek appropriate compensation for the harm done to him.”

A spokesman for CTV said the statement of defence will be filed Monday, and that the network had no further comment.

The statement of defence provides a window into CTV’s investigation into the sexual misconduct allegations, as well as more insight into the network’s process of trying to verify the two women’s accounts.

According to the document, allegations were brought forward to former CP24 reporter Travis Dhanraj in July 2017 and November 2017.

The first tip that Dhanraj received alleged that Brown had “engaged in some sort of sexual misconduct/harassment” against a female staffer on Parliament Hill while he was serving as an MP.

Ultimately, Dhanraj passed the investigation to CTV’s Ottawa Bureau, which the network’s statement said “had more appropriate resources to pursue the story.” The statement also says the Ottawa bureau “had been made aware of other, similar allegations about Brown,” and was conducting its own investigation.

Watch: The #MeToo movement comes to Canadian politics

The statement of defence says CTV’s story was in the public interest as Brown is a politician who was, at the time, seeking to become the premier of Ontario. It also says the network gave Brown a fair amount of time to respond to a request for comment.

Brown announced in May that he would be writing a tell-all book about what he describes as his “political assassination.”

Since the story broke in January, Brown has vehemently denied the allegations, which have not been independently verified by The Canadian Press, saying there are discrepancies in the women’s stories.

Currently, Brown is attempting a political comeback. He’s announced he’s running to become chair of Peel Region.