Funding delay for major projects won’t change timelines
UCP’S upcoming fiscal plans include a fresh look at online short-term rentals
Calgary’s two biggest capital projects will see short-term funding delays in the UCP’S budget, but the government says the timelines for completion are still on track.
The provincial government’s fiscal plan released Thursday projects more than $1 billion in spending toward the Calgary Cancer Centre over the next four years.
But year-over-year estimates until the 2020-21 fiscal year are down compared to the NDP’S previous projections. In its March 2018 budget, the former government earmarked $416 million in capital funding for the project this fiscal year and $379 million next year.
Contrasting figures provided by the UCP on Thursday would indicate it plans to spend less over that time. This year’s contribution to the cancer centre project is slated at $232 million, followed by $265 million next year.
In a statement, the Ministry of Health said the project remains on target to wrap up by November 2022.
“The funding in the four-year capital plan is due to re-profiling of funds into the later years due to updated construction schedule,” it stated. “The project has not been delayed and remains on schedule.”
The UCP is pledging more money toward the cancer centre in the latter half of its four-year plan. In 2021-22, the province estimates it will spend $277 million, up from $137 million projected by the NDP.
Rachel Notley’s government had planned to spend just $10 million in 2022-23, whereas the UCP’S budget includes $260 million that year.
Mayor Naheed Nenshi urged the province to ensure the project gets built.
“People have been waiting decades for that project,” he said.
“It’s well under construction and one of the mistakes that previous provincial governments made — look, my local hospital, the Peter Lougheed Hospital, had a ton of capital investments and there are still wards that are just sitting empty because there’s no operating money for them. What’s the point of building something pretty if you’re not going to run it?
“So to me, I think you’ve got to be able to be truthful about what it is you’re doing.”
John Osler, co-leader of the Concerned Citizens for the Calgary Cancer Centre, said he remained confident the project would proceed as planned following the UCP’S funding commitment.
“Our goal has always been to get the cancer centre built in Calgary and we’re thankful for this continued support for the Calgary Cancer Centre in tough times, and pleased to see that it’s on budget and on schedule,” Osler said.
Thursday’s budget also raises questions about the timeline for construction of future stages of the Green Line LRT, with delays now expected in funding the province has promised.
While the UCP says it will maintain $3 billion earmarked for Calgary and Edmonton LRT projects, most of that money will only start flowing after 2022-23.
Capital funding also appears to have been delayed for upgrades to the Peter Lougheed Centre emergency department and mental health intensive care unit. About $1 million is estimated in funding for this year, with an additional $4 million on the way in 2020-21. The NDP government had promised to contribute all $5 million in last year’s budget.
Here’s what else you need to know about how the budget could affect Calgarians:
OTHER PROJECTS
The UCP government committed $110 million in new funding for Deerfoot Trail upgrades over 2021-22 and 2022-23.
“Deerfoot Trail is an important corridor that we need to invest in,” a spokesman for Transportation Minister Ric Mciver stated.
“We are going to focus on improving the most congested areas on the highway first to improve traffic flow and reduce commute times for Calgarians.”
Further details of the project were not provided.
EDUCATION
While vowing to fund enrolment growth for K-12 education, the budget freezes funding at $8.2 billion for the next four years. The province says Alberta’s K-12 student population is growing at 2.2 per cent, a faster rate than other provinces, and is up by more than 23 per cent over the past decade. Up to $1.8 billion in capital funding for K-12 schools will also fund the construction of 25 new schools across the province, including $123 million for 250 new modular classrooms. But details as to which projects will get the go-ahead have not yet been announced.
On the post-secondary side, the province will lift the NDP’S tuition freeze next year. Tuition fees will rise as much as seven per cent annually for each of the next three years. The move is in line with the
Mackinnon Panel report on Alberta’s finances released last month, which urged Alberta’s universities and colleges to find additional revenue streams and have students pay more to reduce reliance on government money. The UCP says the move will generate $181 million in revenue by 2022-23.
HEALTH
The UCP is pledging $20.6 billion per year for health services, including increases of $100 million for a mental health and addiction strategy, $40 million to respond to the opioid crisis and $20 million for palliative care. There’s also $6 million on the table for a new sexual assault hotline and $4 million for the Health Quality Council of Alberta. Health spending is the government’s largest budget expenditure at about 43 per cent of total operating costs.
But it says Alberta spends more per person on health costs compared with other provinces and that the Health Ministry must be more “innovative and efficient.” An independent firm contracted by the province is in the midst of a review of Alberta Health Services, with a report due by the end of the year.
SMOKING TAX
Effective Friday, the province will raise Alberta’s tobacco tax by $5 to $55 per carton, with the goal of deterring tobacco use. The tax on loose tobacco will also rise 3.75 cents to 41.25 cents per gram and the tax rate applied to cigars will rise from 129 per cent to 142 per cent of the taxable price of the cigar. It’s estimated these adjustments will generate $45 to $55 million per year in additional revenue. The government also intends to implement a tax on vaping products “to reduce youth access to this rapidly growing market.” While details aren’t expected until next year’s budget, revenue from this tax likely won’t top $10 million per year.
AIRBNB LEVY
While most types of temporary accommodation rentals in Alberta are subject to a tourism levy of four per cent, those that operate exclusively through online marketplaces — most notably Airbnb — are often exempt. The government says the tax was not designed with those online short-term rental options in mind, meaning they are not required to charge the tourism levy when they rent out their properties, giving them an unfair advantage over hotels. It plans to bring forward legislation “to level the playing field” in spring 2020.