Municipal funding will be dropping off after this year
Local governments can expect provincial support for construction plans to stay in place for 2021, but the Alberta budget calls for a drop after that.
The Municipal
Sustainability Initiative is a constant item of interest for cities and counties that use the infrastructure grant for a wide variety of local projects.
But, it’s also being constantly adjusted up and down in years out, and with amounts often moved forward. In 2020, the grant was reduced to balance increased spending in 2019, but the province added a separate stimulus program to help local economic activity hampered by the pandemic.
The 2021-22 Alberta budget tabled Thursday by Finance Minister Travis Toews would keep amounts in place for 2021, then slash the grants by twothirds in the following two years.
It was presented as a budget to deal with the immediate economic and health-care crisis caused by COVID-19, but with a longer outlook to tackle growing deficits already projects at $18 billion this year.
“We’ve spent what was necessary to fight COVID-19 (in 2020), and Budget 2021 continues that,” said Toews. “Economic recovery and growth will be necessary to this province to get back to balance.”
The opposition New Democratic critic for municipal affairs, Joe Ceci, called the $750-million decrease in MSI and cuts to education “a dark day for Alberta.”
MSI provides about $10 million annually to Medicine Hat for a wide range of city construction projects. The entire Municipal Sustainability Initiative will be $1.2 billion this year, then $485 million for the two subsequent years, down from previous projections above $800 million.
The difference could be more than $5 million less in the Hat.
A $593-million fund for cities to green light economic stimulus construction projects in 2020 will continue in $2021, but with just $110 million set aside for water projects and $42 million for strategic transportation projects.
“The additional funding for municipalities provided due to COVID-19 and the economic downturn requires the province to reduce average funding over the next few years,” reads the budget document.
In another area watched closely by municipal administrators, the province seems to keep its local property tax payments unchanged.
Last year, the province cut grants it pays instead of local property taxes by 25 per cent, causing rates to increase for other non-residential accounts.
The estimate is unchanged for 2021.
The education portion of property tax bills will also remain frozen in 2021, after a similar move in 2020. The budget states the province “encourages municipalities to adopt a similar approach.”
In specifically outlined capital projects, Medicine Hat families who deal with disability issues could see new help in 2021 with one of four “family-governed” resource centres across the province. St. Paul, Grande Prairie and Edmonton will also see centres developed at a combined cost of $2 million this year.
Among broader issues of interest to Medicine Hat and southeast Alberta, Alberta
Energy will continue work on the natural gas strategy, which seeks investment for petrochemical production and LNG export projects.
Related investment attraction programs aim to speed up environmental approvals on major projects, $1 million will be put toward creating pre-designated industrial zones, and another review of the municipal government act, with an eye toward reducing regulation is planned.
Alberta Agriculture outlines $244 million for support over seven years for upgrades and reservoir expansion in irrigation districts, a three-way funding deal including Ottawa’s infrastructure bank announced last fall.
This summer the government announced twinning Highway 3 between Taber and Burdett would cost $150 million, but the budget only outlines $85 million in spending over the next three years. Only $10 million in slated to be spent in 2021, $28 million in 2022, then $47 million in 2023.