Regional Centre Funding
IT IS THEREFORE RESOLVED THAT the AUMA advocate for a dedicated funding stream for municipalities who serve as regional service centres.
WHEREAS some municipalities serve as regional service centre hubs for commerce, recreation, health care, social services, and provincial amenities;
WHEREAS there are unique challenges that are disproportionately faced by regional centres;
WHEREAS these unique challenges result in a disproportionate tax burden being placed on residents of these communities;
WHEREAS the Alberta government’s 50% reduction in GIPOT funding disproportionately impacts regional centres which typically have more provincial facilities such as court houses, hospitals, schools, etc.
Some municipalities in the Province serve as regional centres where a variety of services are located. As a regional service centre, a municipality has increased costs due to the variety of municipal services it must provide while not receiving offsetting revenue for these costs.
For example, regional service centres are typically where community halls, churches, non-profits, and social housing projects are located. None of these facilities generate property tax, yet the municipality still has to provide snow removal, fire services, storm drainage, etc. to these properties.
These services are also provided to provincial properties such as court houses and health facilities. While some funding for these services are provided by the Province through GIPOT, in recent years this funding has been cut by 50%.
Additionally, regional service centres attract a greater number of street engaged and at-risk individuals. This increases the demand for the social services provided by these municipalities. While the Province does support many of the direct costs of providing services to this population, there are many indirect costs that are borne by the municipalities such as increased policing/enforcement costs and funding to non-profits operating in the sector.
Having a dedicated funding stream for regional centres would address the disproportionate burden that is placed on their taxpayers.
A response from Municipal Affairs on March 15, 2022 stated:
“The Government of Alberta understands that municipal infrastructure is critical to meeting the needs of citizens and supporting Alberta’s economy. This is why the government has fulfilled its commitment to providing predictable, long-term infrastructure funding for all municipalities through the Local Government Fiscal Framework Act. This act establishes a new funding mechanism for municipalities beginning in 2024/25. The Local Government Fiscal Framework (LGFF) also includes $30 million of operating funding that is not legislated.
Municipal Affairs will be engaging with local governments and associations to gather input regarding the LGFF allocation formula and program design elements. This will provide an opportunity for local governments to influence how LGFF funding will be distributed. If municipalities would like to dedicate parts of this funding to regional service centre municipalities, government would certainly consider such a condition, as government and municipalities work together to develop the LGFF formula, provided that it has broad support from those impacted.”
ABmunis’ Rating of the Government’s Response
Intent not met – further action will be taken.
ABmunis’ Notes and Actions
The response from the Minister of Municipal Affairs in March 2022 focused on the Government of Alberta’s intention to provide Local Government Fiscal Framework (LGFF) Capital funding to municipalities and that it would entertain any proposals where the LGFF Capital allocation formula could dedicate funding for regional service centres.
ABmunis proposals on the LGFF Capital allocation formula to the Rural Municipalities of Alberta and the Minister of Municipal Affairs focused on the need for population to represent a high proportion of formula weighting, which indirectly supports regional centres due to their higher and often growing population. At the same time, the
Government of Alberta’s plan has involved reducing LGFF Capital to only $722 million when municipalities previously received an average of $1.1 billion to $1.2 billion annually. As such, ABmunis’ Board has focused the majority of its advocacy efforts to seek an increase in the starting amount of LGFF Capital instead of asking for other new funding programs. ABmunis awaits the release of the province’s 2024 budget to determine next steps for advocacy on capital funding.