Gandam questions municipal funding in Premier’s speech

During the Town of Vauxhall Council meeting on May 21, 2024, Council reviewed and discussed a letter sent from Tyler Gandam, President of Alberta Municipalities, to Premier Danielle Smith regarding her recent attendance and speech at the Alberta Municipalities Spring 2024 Municipal Leaders’ Caucus in Edmonton on March 15, 2024.

“We sincerely appreciated you were willing to take questions from audience members and even extend your time to converse on matters that are important to municipal leaders,” said Gandam’s letter.

In Gandam’s letter, he shares to Premier Smith that during her address to the audience, she stated that the Government of Alberta will provide $3.6 billion in capital funding support to municipal governments in 2024 consisting of: $2.23 billion in municipal infrastructure support, $577 million in capital maintenance and support, $708 million in roads and bridges, and $95 million in additional projects.

“During that same speech you promoted that this funding support represents $900 million more in funding than what the Government of Alberta will requisition from municipalities in 2024 through provincial property taxes,” said Gandam’s letter.

Following the event, Gandam’s letter stated, several members of Alberta Municipalities contacted the Alberta Municipalities seeking clarity regarding the figures mentioned in the speech. “Based on our findings, we wanted to bring to your attention that only 48 per cent of that $3.6 billion expenditure represents provincial funding for municipal governments,” said Gandam’s letter.

In an enclosure to Gandam’s letter, he broke down the numbers from the speech and highlighted some of what the numbers involve:

Provincial Funding for Municipalities

Provincial funding programs for municipalities ($722 million in Local Government Fiscal Framework Capital funding and $188 million through competitive application programs): $910 million

Provincial funding for one-off municipal projects (not part of a formal funding program): $819 million

Total : $1,729 (billion)

Federal Funding for Municipalities & Provincial Expense on Provincial Infrastructure

Funding from the Government of Canada that flows through the Government of Alberta to municipalities: $764 (million)

Provincial expenditures on provincially owned highways and bridges, which are unrelated to the scope of municipal government operations: $1,116 (billion)

Total: $1,880 (billion)

Total Quoted Expenditure: $3,609 (billion)

“With $1.88 billion of the $3.61 billion consisting of a combination of federal funding for municipalities and provincial spending on provincial infrastructure, this means that only $1.73 billion is the total provincial capital funding contribution to municipal governments in 2024,” said Gandam’s letter. “This highlights how total capital funding from the province is actually $1 billion less than the $2.7 billion that the Government of Alberta will requisition from municipalities this year. This demonstrates another reason that the starting amount of the Local Government Fiscal Framework Capital funding should have been set at $1.7 billion instead of $722 million.”

Gandam’s letter then firmly stated that Alberta Municipalities wishes to share the aforementioned information to provide clarity to the inequity between funding to municipalities and provincial property taxes that are requisitioned from municipalities.

“This is why we applaud that your mandate letter to the Honourable Ric Mclver, Minister of Municipal Affairs, includes the initiative to review how the provincial property tax system can be changed to enable municipalities to retain more funding,” said Gandam’s letter. “We optimistically wait for the result of that review to be shared and look forward to receiving an update on the expected timing.”

Gandam’s letter concluded by inviting Premier Smith to contact him if she wished to discuss the letter or other matters. The letter was also addressed to Honourable Nate Horner, President of Treasury Board and Minister of Finance, Honourable Ric Mclver, Minister of Municipal Affairs, and Paul McLauchlin, President, Rural Municipalities of Alberta.

Councilor Zacharias made a motion to accept the letter as information and the motion was carried.

Heather Cameron, Local Journalism Initiative Reporter, The Taber Times