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Home > Lowe's for Pros > How the Economic Action Plan Can Grow Your Business

How the Economic Action Plan Can Grow Your Business

How the Economic Action Plan Can Grow Your Business

The Economic Action Plan, Canada's stimulus package response to the recession, made huge strides in 2009 to boost the construction industry, among others. Now in its second year, the plan's benefits are still being felt.

"I think the Action Plan overall was absolutely the right thing for the federal government to carry out," says John Kenward, chief operating officer of Canadian Home Builders Association. "Obviously the industry needed the type of public expenditures the Action Plan contained. It certainly helped the housing industry through a challenging time," he says.

How it's helping

According to the Department of Finance's Budget Plan, the Action Plan will provide $7.7 billion in stimulus in 2010—11 to modernize infrastructure, support home ownership, stimulate the housing sector and improve social housing across Canada. This builds on the $8.3 billion in infrastructure and housing stimulus delivered in 2009—10.

More than $4 billion will be invested in provincial, territorial and municipal infrastructure, $285 million in First Nations community infrastructure and $780 million in priority federal projects. Also, more than $2 billion will be used to renew Canada's social housing stock. This means Action Plan funds have supported 16,000 projects across the country of which 12,000 have begun or have been completed. The projects range from improving infrastructure at college universities to modernizing federal laboratories to upgrading facilities at national parks and historical sites.

Measures that have already helped

Although many of the Action Plan's incentives and credits are no longer available, Kenward says their benefits are still being felt in the construction industry. Here are a couple of the Action Plan's biggest successes so far.

The Home Renovation Tax Credit (HRTC)

Available during the 2009 tax year, the HRTC was a non-refundable 15% tax credit given to those who made improvements to their house, condo or cottage between January 27, 2009 and February 1, 2010.

"It was a very successful and effective measure that helped to stimulate renovation activity," says Kenward.

James Buduhan, LEED AP, project manager with Urban Zen Developments Ltd, agrees with Kenward and says there was a lot of positive reaction to the HRTC because it provided a great incentive to immediately do the kind of work a homeowner usually puts off.

"I think the HRTC was the clincher that sold people to ‘finally redo the bathroom' or ‘finally upgrade the ugly counters in the kitchen,'" he says.

The ecoEnergy Retrofit Program

In an effort to improve energy efficiency in infrastructure, the Action Plan also created the ecoEnergy Retrofit Program, which provided grant money towards green retrofitting for residential homeowners and organizations.

"Focused on reducing energies, the program has short-term benefits and long-term payback," says Christopher A Higgins, LEED(r) AP Homes, program coordinator, Canada Green Building Council. "It's investing in the economy."

Like the HRTC, Higgins says the program provided great incentive to those who have been wanting to do green retrofitting but have been putting it off, one reason being the large expense.

Although the program is now closed to new projects because the grant money has been depleted, Higgins says there are still projects under construction that need work.

Help during a crisis

According to Kenward, the industry is very grateful for the Action Plan's aid during one of the worst economic times in the country's history.

Although Kenward says his industry is opposed to short-term stimulus measures and government intervention, it was necessary in our current times because the economy was so "severely challenged."

"The government at a time of crisis has a responsibility to take actions to support the economy through that period of crisis," he says.

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