OTTAWA – Transportation Minister John Baird has urged Toronto to come up with a list of other infrastructure projects in a letter where he drives a final stake into the heart of the city's plans for federal funding for new streetcars.

Baird, in a polite but blunt letter to Toronto Mayor David Miller, makes it clear that the city's wish list for federal cash for new streetcars and a replacement carhouse don't qualify under Ottawa's Infrastructure Fund.

The correspondence shatters Miller's hopes that Ottawa would come up with the money before the streetcar agreement between Bombardier and the TTC expires June 27.

"Unfortunately, these projects are not eligible under this fund. I hope that, after reading this letter, you will understand why that is the case and will be ready to work with me to find other projects to work together on to build infrastructure in the City of Toronto," Baird states in the letter sent today.

Miller told the Star today he saw the letter as an "olive branch" from Baird because it requests the city to come up with a suitable list of projects, which could well give Toronto funding room for the streetcars.

"I take that request as an olive branch ... and provided that we can work in partnership to ensure that leaves $300 million of room for the City of Toronto then that would mean we would be able to find a way to work towards the streetcar project ... which is too important to the city to let fail," the mayor said.

Toronto's streetcars carry some 250,000 passengers daily "so we have to find a way to get this order done." Miller said.

The province and the city had pinned their hopes on Ottawa kicking in more than $300 million as its portion of the $1.2 billion cost for buying 204 new streetcars. The carhouse was over and above that.

Baird insisted that while Ontario municipalities successfully submitted 2,700 project applications using the federal government's simplified online application, Toronto failed to do so.

"Unfortunately, Toronto was not among them. The project that your officials tried to submit clearly did not meet the criteria and so could not be submitted," he stated in the letter obtained by the Toronto Star.

Baird was more explicit about his frustration with Toronto's application during a meeting in British Columbia when he was overhead using profanity.

First and foremost, said Baird, all projects funded from the Infrastructure Stimulus Fund must be completed by March 31, 2011.

"This is clearly not the case with the Light Rail Vehicles and the carhouse. The first of the Light Rail Vehicles will not even be delivered until late 2012 at the earliest, and the project will not be complete until 2018, a full seven years past the deadline. Similarly, the carhouse will not even start, let alone finish construction until after March 31, 2011," he stated.

Baird said the majority of the costs involved in this project over the next two years are not in Toronto and are not for the construction of public infrastructure.

"The streetcars are only guaranteed to contain 25 percent Canadian content, and large portion of the requested funding would go to re-tooling a Bombardier plant in Thunder Bay. This fund was created to build public infrastructure, not modernize factories," the minister stated.

Baird said despite all that he asked federal officials to carefully study the city's request and work with Toronto officials to see if it could be made to qualify, adding that it could not be done.

He said the proposed project may well be an "excellent project of great benefit to the people of Toronto, however ... it simply does not fit within the criteria of the Infrastructure Stimulus Fund."

Baird said he was certain Toronto has many worthwhile projects that would be eligible for the stimulus funding and urged the city to get on with making application for federal cash."I have heard that there are many worthwhile projects ready to go today to improve and renew Toronto's infrastructure. These projects would benefit the people of Toronto by improving roads, water and sewer systems, parks and recreational facilities," he stated."It would be a tragedy if the federal government spent $4 billion on infrastructure stimulus across the country but was unable to spend any of this on projects in Toronto. I will not let this happen. I hope that the federal government will have a cooperative partner in the City of Toronto."

Spending for the streetcar contract was approved by City Council as an equal three-way split and now that Ottawa has pulled out council would have to authorize any new spending.

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This could be complicated by the fact that city workers are in a legal strike position after midnight tomorrow (Sunday), which means in the event of a walkout all city meetings would be cancelled in the event of a walk, including city council.

Miller said he was not concerned since the city has an established five-year capital projects list that senior city staff could draw on.

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