EDMONTON -- Edmonton and other Canadian municipalities are calling for an emergency $10 billion from the federal government they say is needed to keep essential services running at pandemic capacity. 

In appealing to Ottawa Thursday, the Federation of Canadian Municipalities writes local governments are facing at least a $10 billion to $15 billion immediate loss if measures like physical distancing remain in place for six months. 

The estimated shortfall is the total of property taxes, utility charges and user fees which many cities have foregone as a financial break for residents. 

But savings don’t match what it costs to keep taxpayers safe, says the FCM. 

The shortfall in Calgary, for example, is equal to a one-time residential property tax increase of 23 per cent, 22 per cent in Vancouver, and 56 per cent in Toronto estimates the FCM. 

“From turning arenas into safe shelters to deferring property taxes, municipal leaders are working flat-out to support Canadians through this pandemic,” said FCM President and Halifax municipal councillor Bill Karsten. 

“But with new expenses, staggering drops in revenue and no freedom to run deficits, municipalities need emergency funding to keep essential services going strong.” 

The FCM says it would directly inject $7.6 billion of its minimum $10-billion ask into municipalities, and then allocate the remaining $2.4 billion between those with transit systems. 

Although the FCM sees provincial governments as also being impacted by municipal troubles, and therefore as having a role in offering aid, their plea is directed at the federal government which has the most room to backfill budget holes. 

“A number of provinces may or may not be in a fiscal position to help at this point, given the other challenges they’re facing,” said Edmonton Mayor and Big City Mayors’ Chair Don Iveson. 

“Ideally provinces will play a role, but the buck stops with the federal government here.”

‘SOMETHING WILL HAVE TO GIVE’

Iveson said it would be fiscally irresponsible for municipalities to run a deficit, and is something mayors have told him they are reluctant to do after maintaining balanced budgets. 

His council has continued to meet biweekly, and an emergency management committee every week. 

The City of Edmonton is forecasting a $90 million to $260 million hole in its budget passed in December. 

Council has decided to make use of a rainy day fund, but it’s smaller than the likely $140-million shortfall. 

“If you have an elastic set of revenues available to you like income tax and sales tax that grow with the rebound of the economy, you can dig a hole and then fill it in recovery,” Iveson said. 

“If all you have is property tax, it’s going to take a long time to fill in that hole, and the real risk is pushing municipalities into austerity, precisely at a time when you want them delivery those baseline services and investing in infrastructure to support economic recovery.”

In its second week of a state of local emergency, Edmonton announced optional property tax and Businesses Improvement Area Tax Levy payments, and more than 2,000 non-essential employee layoffs. 

The mayors suggested there would be further cuts in each of their cities. 

“Something will have to give,” Karsten said. 

More details on COVID-19’s impact on the City of Edmonton’s budget are expected to be released later in the day.