John Baird, government House leader, speaks to the Association of Municipalities of Ontario on Tuesday in Windsor, Ont. (Vince Robinet/CBC)

The federal government is giving municipalities a bit of wiggle room on its deadline to receive infrastructure stimulus funding.

The $4-billion federal program provides cash to shovel-ready provincial and municipal projects — provided they can be completed before March 31, 2011.

Many local leaders, gathered in Windsor, Ont., for the annual meeting of the Association of Municipalities of Ontario, had expressed concerns that if they couldn't meet that deadline, they would lose the money they were counting on to help pay for the projects.

However, Ottawa assured them it will not leave cities and towns in the lurch.

"Our government will pay its share of eligible costs incurred up to March 31, 2011," said John Babcock, press secretary to Chuck Strahl, Minister of Transport, Infrastructure and Communities.

'We are not going to claw any money back that was initially talked about.—John Baird, Government House Leader

"But if a project is not completed by March 31, 2011, our government will not claw back its contributions, provided the recipients commit to completing the project."

Babcock said work has already commenced on more than 93 per cent of the projects countrywide, while 56 per cent of the projects will be completed ahead of schedule.

John Baird, who was responsible for the portfolio until his recent appointment as Government House Leader, reiterated the pledge to municipalities while speaking with reporters in Windsor.

"We are not going to claw any money back that was initially talked about," said Baird, who pointed out that only one per cent of all federal stimulus projects are at high risk to not be completed by the March 31 deadline.

The Infrastructure Stimulus Fund was created to spark construction and create jobs across the country by funding projects focused largely on upgrading things like water supplies, public transit, highways, parks or municipal buildings. Projects that improved the infrastructure for supporting the arts and culture were also eligible.

Speaking to the AMO on Monday, Ontario Premier Dalton McGuinty had issued an appeal to the federal government to extend the deadline.

"Let's be reasonable," he said. "Let's ensure we don't leave four walls standing without a roof. Let's find a way of coming together and finish that job."

Gerard Kennedy, the Liberal MP for Parkdale -High Park, said the program's design and specifically the government's March deadline has cost taxpayers millions of dollars.

"Tenders came in higher, because the government didn't get its approvals out in time for the first [construction] season," said Kennedy.

"And the other thing is, they're charging a premium to get things done by March 31."