Many small towns face existential challenges, study finds

Alberta model gives residents say on dissolution

CALG ARY A new University of Calgary research paper says Alberta villages and small towns face serious fiscal challenges, but suggests Alberta's case-bycase way of helping struggling municipalities deal with their problems is appropriate.

Smaller municipalities have seen their populations stagnate or decline while job opportunities and young people leave for bigger cities. They also face low birth rates and the attraction of big cities for immigrants looking to settle in the province, says the paper, called Assessing the Viability of Smaller Municipalities: The Alberta Model.

“Given the nature of changes both in our population and in our economy it's just become more difficult for smaller towns and villages to sustain themselves over time,” said Kevin McQuillan, a research fellow with the University of Calgary's School of Public Policy and one of the study's authors.

The research paper, released Tuesday, says the “vast majority” of Alberta's 332 municipalities are in good financial shape. To help struggling municipalities, the Alberta government uses municipal viability reviews, which address the situation on a case-by-case basis. A total of 26 municipalities have undergone reviews, and half — 13 — have voted to dissolve and become hamlets in their counties or municipal districts. There are three viability reviews currently underway for the villages of Delia and Bittern Lake and the summer village of Ma-Me- O-Beach.

“(The viability review process) is quite a distinctive way of approaching a problem that we see right across Canada and other countries too, in England and parts of Europe, in Australia,” said McQuillan.

Many of the struggling municipalities have a declining and aging population. Among the towns the province has reviewed, only one grew in population between 2016 and 2021, says the research paper.

The municipal council sometimes asks for a review, or sometimes it's initiated by Alberta Municipal Affairs, said McQuillan. He said local residents have quite a bit of input during the process, which ends in a referendum to see whether community residents wish to dissolve the independent municipality or continue to deal with the issues brought up during the viability review.

“The idea of allowing a vote for the community and certainly encouraging participation is a good one, but it does raise some issues if a community decides, `No, we don't want to dissolve,' but the problems persist and may even get worse over time,” said McQuillan.

He added that calls into question whether there needs to be another direction the Alberta government can take to order the municipality to be dissolved or reorganized in some way.

While Alberta hasn't run into those kinds of problems yet, there are some communities that have decided to stay independent but continue to face problems such as a declining and aging population and infrastructure deficits, said McQuillan.

But even if a community does dissolve, it's not a “cure-all,” the paper's authors point out, and merely transfers the municipality's problems to the rural municipality that absorbs it.

That's a worry for the rural municipality, particularly in situations where there's a big backlog of infrastructure projects that need to be addressed, said McQuillan.