Smoky River could lose millions in oil & gas revenue

Richard Froese
South Peace News

The M.D. of Smoky River expects to lose millions of dollars in property taxes from the oil and gas under a plan by the provincial government.

The government proposes to reduce the property taxes of oil and gas companies through changes to the assessment model for regulated properties in this sector, says a news release from the M.D. dated Aug. 14.

“Council and administration are extremely concerned about the serious impacts of this decision as it will mean an increase in residential property tax, reduction of services, or combination of both to compensate for this loss in revenue,” Reeve Robert Brochu says.

“While the stated intention of this decision is to increase the competitiveness of oil and gas companies in this difficult economy, these changes will disproportionately benefit multinational oil and gas companies and harm smaller companies and residential ratepayers.

“This loss in municipal revenue has to be derived from other ratepayers through a combination of increased taxes and/or decreased services.”

The M.D. lost 35 per cent of its revenue in 2019 from unpaid oil and gas taxes and is expecting a loss of 40 per cent of its tax revenue in 2020 a combined total loss in revenue of $5.7 million in the last two years, Brochu says.

Oil and gas assessment has also decreased by 13 per cent or $35 million in the last three years.

“These proposed changes would contribute to yet another significant loss in municipal revenue,” Brochu says.

That would be a big blow to the municipality surrounding the towns of Falher and McLennan.

“The Municipal District of Smoky River would need to eliminate services, discontinue regional agreements or raise property taxes to account for this loss in revenue,” Brochu says.

“This would have a direct financial impact on our ratepayers and our ability to maintain our 1,781 kilometres of road, 105 bridges, and over 5,000 culverts.”

Smoky River council is calling on residents and taxpayers to plead the provincial government to back down.

“Let your government officials know your thoughts on this issue,” Brochu says.

“The final decision by the Government of Alberta and Premier Jason Kenney on this proposal is expected by mid to late August, he says.

With the additional expenses of the Police Funding Model mandated by the provincial government and downloaded to Alberta municipalities, ratepayers will see significant property tax increases in the coming years, he says.

The government is proposing these changes to the oil and gas industry to reduce their property and education tax, the news release says.

Smoky River council is contacting the provincial government to express serious concerns regarding these changes and is working alongside the Rural Municipalities of Alberta (RMA) and with neighbouring municipalities in an attempt to advocate for rural residents.

To lobby the government, residents are urged to contact the following:

  • -Premier Jason Kenney – e-mail to premier@gov.ab.ca.
  • -Municipal Affairs Minister Kaycee Madu – e-mail to minister.municipalaffairs@gov.ab.ca.
  • -Energy Minister Sonya Savage – e-mail to minister.energy@gov.ab.ca.
  • ·Associate Minister of Natural Gas and Electricity, Dale Nally – e-mail to aminister -natgas@gov.ab.ca.
  • ·Central Peace Notley MLA Todd Loewen – e-mail to CentralPeace.Notley@assembly.ab.ca.

For more information, resident may contact their local councillor listed on the M.D. website at www.mdsmokyriver.com.

Share this post