Barrie and the County of Simcoe have put their support behind the local health unit’s application for a maximum $5-million line of bank credit to pay its pandemic-related bills until provincial funding arrives.
Barrie city council provided its consent Monday to the Simcoe Muskoka District Health Unit (SMDHU). County of Simcoe council provided its consent during their meeting Tuesday morning.
Coun. Ann-Marie Kungl, who sits on the the health unit board along with Coun. Gary Harvey, said the SMDHU has requested $9.5 million for COVID costs since Jan. 1 but will receive just more than $4.4 million at this point. It awaits the remainder of the provincial funding.
“The ministry (of health) thus far has only said that they are going to cover certain percentages and they are not at the normal 70/30 split that we are accustomed to…and that’s where the huge shortfall is,” Harvey said. “All of this COVID funding is additional costs that no health unit in this country had budgeted or planned for.
“When all of a sudden your budgets are ballooning because of a pandemic, it’s no wonder that we’re in the fiscal, financial situation that we are, because we still have the bills to pay,” he said. “But we haven’t been given the money from the higher levels of government. Until that cash starts flowing, this is the situation that we find ourselves in and this (line of credit) is an interim fix.”
But Coun. Mike McCann wanted to know about a worse-case scenario, if the city would be responsible for a portion of the $5 million if the province wouldn’t pay it. He received a few different answers.
“There’s no financial implication to the city of the health unit getting a line of credit,” Mayor Jeff Lehman said. “If they don’t get their bill paid, by the province, for the work they’re doing to lead the pandemic (response), they’re going to come back to the municipal partners and then there sure as heck a financial implication.”
Deputy Mayor Barry Ward said he doesn’t see that happening.
“We are not (giving) them (SMDHU) any money, we are not going to be on the hook for any money,” he said. “There’s a chance that if the province for some reason said naw, we’re not going to repay you for all of those expenses you’ve run up, well they’re going to have to turn to somebody to pay them, and that would be us.
“But I can guarantee across the province there would be such an outcry from municipalities if the province ever wasn’t going to cover the pandemic costs.”
Ward said he sat on health unit board for many years and there were similar situations for the SARS outbreak and H1N1.
“In all cases the province came through and covered the cost fully at the end of the day,” he said. “We are at no risk.”
“This is the province’s responsibility,” McCann said.
When it came time to vote on providing the health unit with consent for a line of credit, there was unanimous approval.
“I think we need to do everything we can to make sure the health unit has its resources during the pandemic,” said Coun. Keenan Aylwin.
“At this point they (HU) need to pay their bills,” said city treasure Craig Millar. “They’re not asking us to give them anything, they’re just asking if they need to draw the money from the bank, they have that option.
“If the province changes the (funding) formula or doesn’t honour it, decides they’re not going to cover the costs, then the health unit I would anticipate would come to the municipalities to ask for funding.”
“It’s pretty astonishing that the province has put the health unit in this position,” Lehman said. “The last thing you do when you’re pouring water on a fire is count the cost of the water coming out the end of the pipe.
“You use the water to put out the fire and then we deal with the implications of it.”
At County of Simcoe council on Tuesday, Penetanguishene Deputy Mayor Anita Dubeau, who also serves as chair of the SMDHU Board of Health, urged fellow members of county council to support the request.
“I know that it’s a very unusual ask but we seem to be in a very unusual time. We were asked by the ministry to submit two streams of funding costs, and to date we have received less than 50 per cent of one of the streams,” said Dubeau, adding the pressure of not having access to the full amount of COVID-19 funding has placed the board in a precarious financial situation.
Adjala-Tosorontio Deputy Mayor Bob Meadows was less than impressed with how the province has left local health units scampering to cover costs, despite very public promises to help.
“The Ford government should be backing what they are saying out there to people. I think it’s time we spoke out against it. They don’t mind tooting their own horn when they’re saying they're doing all these great things, but when they’re not funding all these great things they’re saying they are doing, then I have a big issue with it,” he said.
Dubeau agreed, adding it’s a terrible thought that a health unit would have issues meeting its payroll. “That’s the kind of situation we may find ourselves in and that is why we need to have a back up plan - and our back up plan is the $5 million line of credit, but we are lobbying big time.”
Barrie, Orillia, the County of Simcoe and District of Muskoka are the SMDHU’s municipalities. The health unit needs the approval of these four municipalities, based on the Municipal Act, in order to apply for the line of credit.
“I see in the letter that they (SMDHU) have had to liquidate their reserves, so I believe they are in a very precarious situation,” added Orillia Mayor Steve Clarke, who had joined Tuesday’s conversation.
Clarke questioned if the province was going to be forthcoming with the promised funds, noting if it is not, it will prove to be a very “interesting situation” that would require additional action from the health unit and from the county.
“It strikes me we need a commitment from the province, and it surprises me that hasn’t been able to be attained,” said Clarke.
When asked by Clarke if she was confident the province would step up with the remaining funding, Dubeau said she “would hope they would” but acknowledged the board has been made to jump through a number of hoops in the process.
“That is the issue, along with the length of time before the province writes the cheque,” she said. “The board does not want to leave (itself) in a situation where (it) can’t meet payroll. That would actually be (devastating). We can’t allow ourselves to get there."
"Yes, we have depleted monies that we had available and are at a crossroads. I do believe the government will pay, but it’s just what they put us through to get there,” said Dubeau.
The province is funding COVID extraordinary expenses; a budget was established in January for 2021 and submitted to Ontario’s Ministry of Health. Expenses include salaries, supplies, personal protection equipment (PPE), transporting the vaccines, etc.
The interest rate on the line of credit will depend upon how much funding the health unit actually needs, and the SMDHU has been told that the province would reimburse it for the interest charges.
Ontario’s Health Ministry has said the public health system has demonstrated remarkable responsiveness to COVID, as the pandemic has evolved locally and globally. Under normal circumstances, public health units are expected to respond to and manage infectious diseases of public health significance through existing operating budgets and funding allocations.
But COVID-19 has required a level of response from the public health sector that goes far beyond the norm, the ministry has said, resulting in increased expenditures. Processes have been put in place for public health units to request reimbursement from the Ministry of Health of extraordinary costs incurred with responding to COVID-19 at the local level.
Provincial funding allocations for all public health units in 2021, including one-time funding to offset extraordinary costs incurred responding to the pandemic at a local level, were confirmed and recently communicated to public health units.
Funding is expected to flow shortly, the ministry said last week.
Since 2020, the ministry has invested approximately $665 million in additional one-time funding for public health units to support and enhance COVID monitoring, case and contact management and delivering local vaccine programs.
With files from Nikki Cole.
