2027 LGFF Operating Funding formula
Municipalities should take a cautious approach when budgeting for the Local Government Fiscal Framework (LGFF) Operating funding in 2027. The Government of Alberta is expected to introduce a new allocation formula, which could result in changes to the amount of funding individual municipalities receive.
Background
Since LGFF Operating was introduced in 2024, the Government of Alberta has continued to fix the allocations for each municipality based on historical amounts set under the former Municipal Sustainability Initiative allocation formula. As a result, the fixed allocations continue to be based on 2019 data.
In early 2025, Municipal Affairs sought input from Alberta Municipalities (ABmunis) and RMA on the design of a new allocation formula for LGFF Operating. ABmunis provided recommendations on the design of the program, and we recommended that Municipal Affairs give municipalities as much advance notice as possible about how funding may change so municipalities can plan their budget accordingly.
While the total funding for LGFF Operating is forecast to remain unchanged at $60 million in 2027, any change in the allocation formula and the use of more current data will change the amount allocated to each municipality. Some municipalities may receive more funding, while others may receive less than past years.
ABmunis will continue to monitor developments and share updates as more information becomes available. In the meantime, municipalities are encouraged to take a cautious approach to 2027 budgeting and consider the potential for changes to their LGFF Operating allocation.
