Regional Hospital Districts’ Capital Infrastructure Funding Formula



NCLGA Executive Recommendation: No Recommendation


WHEREAS a primary purpose of a regional hospital district under the Hospital District Act is to establish, acquire, construct, reconstruct, enlarge, operate and maintain hospitals and hospital facilities;

AND WHEREAS the current practice is that long-term capital infrastructure projects are financed based on a cost-sharing formula of 60% the Province and 40% the Regional Hospital Districts, which is often not achievable for rural hospital districts:

THEREFORE BE IT RESOLVED that the NCLGA lobby the Provincial Government to formally establish a reduced expected rate for rural Regional Hospital Districts below the current standard of 40% as their contribution to capital infrastructure projects.


Although not captured specifically in legislation, it has been the practice of the Province to expect a contribution of 40% from Regional Hospital Districts for funding capital projects.

This formula is not in favour of rural hospital districts with lower populations and less robust economies making the reality of much-needed infrastructure upgrades or replacements in these areas difficult or impossible to achieve based on the tax-payers’ ability to pay.

In 2003 the Ministry of Health Services engaged a consultant to conduct a review of the cost sharing processes between the Ministry, Health Authorities, and the Regional Hospital Districts. The recommendations in the report have not been implemented to date but Recommendations 1 and 2 from the report read as follows:

Recommendation 1: Regional Hospital District (RHD) contributions are voluntary.  The onus must rest with the Health Authority to develop and maintain effective working relationships with the RHDs in its region.

Recommendation 2: Health Authorities must be unfettered by cost-sharing requirements in their ability to provide required health services regardless of the fiscal capacity of a region.

Supporting comments for Recommendation 2 indicated that “a maximum 40% capital contribution by RHDs is sound and should continue.  At the same time, there has to be recognition of variation in the ability of RHDs to contribute to capital projects”.


UBCM Comments:

The UBCM membership endorsed resolution 2016-B114, which asked the provincial government to prioritize the review of the historic cost sharing ratio between regional hospital districts and the Province, for health care capital costs.

In response to resolution 2016-B114, the Province expressed willingness to proceed, when the legislative agenda permits, with a review of and amendments to the Hospital District Act, to clarify issues including funding.

North Central Local Government Association