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More engagements planned for oil and gas assessment model review , says minister

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MOUNTAIN VIEW COUNTY – With Alberta’s rural municipalities saying oil and gas companies now owe more than $170 million in unpaid property taxes, Municipal Affairs Minister Kaycee Madu has sent a letter to Mountain View County saying he intends to have “additional engagement” conducted with industry and municipalities.

In a letter received by council at a recent regularly scheduled council meeting, Madu says the current review of assessment models used to “ensure new technology is accounted for, current cost structures and industry practices are reflected” needs the added consultation.

“As assessment changes can have consequential impacts on both municipalities and the oil and gas industry, I have determined additional engagement with industry and municipal associations is required before any final determinations are made,” said Madu.

The government’s intention is to “ensure any changes results from the assessment model review do not have an adverse impact on the competitiveness of our energy sector or the viability of our rural municipalities,” he said.

“It is my intention this more robust stakeholder engagement be carried out in early 2020, with final decisions on the assessment model review to be made in spring,” he said.

“As a result, the changes to the assessment models will need to be deferred until the 2021 municipal tax year.”

Al Kemmere, Mountain View County councillor and president of the Rural Municipalities of Alberta, says rural municipalities are being hard-hit by the delay in realizing the property tax revenue.

According to a recent RMA member survey, oil and gas companies owe more than $173 million in property taxes to the RMA’s member municipalities.

That represents a 114 per cent increase from the $81 million identified as being owed in March 2019.

The non-payment of taxes by oil and gas companies to municipalities is creating significant financial concerns for those municipalities, with many oil and gas companies unable or unwilling to pay what they owe, he said.

“Municipalities require property taxes to provide infrastructure and services that industry relies on to access natural resources,” said Kemmere.

The RMA is calling on the provincial government to update the Alberta tax collection regime to give municipalities more opportunities to collect the unpaid taxes, he said.

“If Alberta’s property tax system is not amended to prevent oil and gas companies from refusing to pay property taxes, many rural municipalities will struggle to remain viable,” he said.

“Strengthening municipal tax recovery powers would help address this issue, but broader action to address the industry’s struggles is needed, as the viability of both industry and rural municipalities is at risk.”

Kemmere says he will be meeting with Minister Madu sometime later this month to discuss outstanding issues, including the matter of unpaid property taxes owed by oil and gas companies.

The letter was received as information at the Feb. 5 council meeting.

 

 



Dan Singleton

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