While area government MLAs are calling the UCP government’s 2019 budget a balanced and prudent fiscal plan, some area municipal leaders say it will create significant challenges for counties and towns.
Released Oct. 24, the budget will see the province cut its operating spending by $1.3 billion or 2.8 per cent over the next four years. The government is budgeting $50 billion in revenue this year and $50.1 billion next year, $53.6 billion in 2021-22 and $57.5 billion in 2022-23.
The budget calls for a reduction in Municipal Sustainability Initiative (MSI) funding by $94 million in 2020-21 and $142 million in 2021-22. The fund is used by municipalities on projects such as infrastructure upgrades.
Mountain View County reeve Bruce Beattie says the cut in MSI funding will compel the municipality to re-examine its plans for infrastructure upgrades going forward.
“To me it’s a bit short-sighted to reduce spending on infrastructure, because it is going to deteriorate if it isn’t maintained,” said Beattie. “We have a long-term infrastructure plan that we developed over the last few years and we may just have to rejig that to see where that fits with our revenues.
“Rural municipalities have the responsibility to provide good infrastructure. We need to make sure that we do that and also spend the money where it is most needed. That’s what we will have to do, go back and prioritize on those projects to see what needs to be done and what we’d like to do but maybe can’t do for a while.”
“I know there will be a lot fewer (infrastructure) projects I think in the coming year or two than there has been. I believe in maintaining our infrastructure because that’s what keeps the economy moving.
Asked if he believes municipal taxes will have to go up, he said, “We will have to get a sense from our constituents about to what extent do we increase our taxes to compensate for those reductions from the province.”
Didsbury mayor Rhonda Hunter said the cuts to MSI funding will impact the town.
"When we lose funding, the only place these costs for vital projects can go is to the municipal ratepayer, and into the municipal budget, or into municipal service cuts," said Hunter.
"Municipalities are being asked to take on more responsibility for these major costs."
She said she is pleased that library, police and FCSS (Family and Community Support Services) funding is being maintained.
Al Kemmere is the president of the Rural Municipalities of Alberta Association and a Mountain View County councillor. He says the reduction in MSI funding may affect rural municipalities across the province.
“This is a capital money so it will affect the projects that go forward, those projects that were planned with this money in mind,” said Kemmere.
“You either delay the projects or you fund them from other areas in the operation or you adjust it through taxes. Those will all be local decisions.”
Uncertainties around future policing costs, assessments, and unpaid property taxes, on top of the MSI cuts, remain a concern, he said.
“When you accumulate that all together then you have some significant impacts on our member municipalities. This magnifies the challenges,” he said.
Kemmere says he is pleased to see the province upholding funding for such things as libraries, palliative care and FCSS funding.
Under the budget the ministry of health will see a cumulative 1.3 per cent increase over four years, while the ministry of advanced education will see a cumulative 11.8 per cent decrease over the next four years.
Other cuts include 9.1 per cent or $88 million from agriculture and forestry, 7.6 per cent from the ministry of culture, multiculturalism and status of women, and an 18 per cent cut this year from the ministry of economic development, trade and tourism.
For post-secondary institutions, overall tuition increases are capped at seven per cent for each of the next three years.
Jason Nixon, minister of environment and parks and the UCP MLA for Rimbey-Rocky Mountain House-Sundre, calls the budget tough but fair.
“I think the budget is exactly what we promised Albertans in the spring, which was to get our spending under control and put our province on the path to balance,” said Nixon.
“This is the first time in over 25 years that Alberta has a government that is willing to make cuts to be able to get our fiscal house in order.”
As far as the cuts to MSI, Nixon said, “I disagree that we are just downloading on municipalities. There’s no doubt that municipalities are being called upon to help share in helping get our province back on track.
“We are expecting our municipalities to partner with us on this. There’s no doubt we are expecting them to share in the hard work that we have to do as Albertans to get our house in order.”
Regarding the removal of the freeze on tuitions at colleges and universities, he said, “The reality is Alberta spends more than anywhere else in this country on post-secondary and even after this budget we still spend more than anywhere else in this country.
“We have to make tough decisions to be able to get to the path of balance. I think the post-secondary decision are measured.”
Nathan Cooper, the UCP MLA for Olds-Didsbury-Three Hills, echoed Nixon’s comments, calling the budget a prudent and needed plan.
“I think one of the big highlights in the government is keeping their commitment that they made to Albertans to be more fiscally responsible,” said Cooper.
“While the government has made some difficult choices, I think it is important that we made them now before it is even more difficult in the future.”
Regarding cuts to MSI, Cooper said, “Governing is about choices and we are all in this difficult position together and we need to rally around that. We want to do what we can to continue to work with municipalities during what is going to be a period of fiscal restraint.
“I'd like to say that it is important that we have maintained front-line services. These are priorities of Albertans and of the government as well.”
Regarding lifting of the tuition freeze, he said, “Certainly it is going to affect the college (Olds College) in one capacity or another. Just because the tuition cap is raised it doesn’t mean colleges have to raise tuitions. Lifting the tuition cap is an important step in ensuring that both students and institutions have a fiscal framework that keeps them competitive.”
NDP official Opposition Leader Rachel Notley calls the budget bad news for rural and urban communities.
“It’s a plan to make everyday Albertans pay for their $4.5 billion no-jobs handout to big corporations and the super-rich which has done nothing but usher in 27,000 job losses,” Notley said in a press release.
“And while people are losing their jobs, this government is cutting employment and income supports by 20 per cent over the next four years.
“What we saw today is Premier Kenney’s plan to make you pay more and get less. What he didn’t tell us was that every single Albertan was going to pay more in income tax.”
Olds mayor Michael Muzychka could not be reached for comment at press time Monday.
– with files from April Hudson, Great West newspapers