By Kevin J. Sabo
For the Advance
It’s no secret that many services operated by the Town of Stettler are possible through collaboration with Stettler County; however, with the proposed oil and gas assessment changes, that collaboration could be at risk, say representatives from both the Town and County.
Services such as the regional landfill, library, regional water supply, FCSS, ambulance and fire departments, and the Heartland Youth Centre are all organizations that benefit from a collaborative approach, and there are more.
“It could jeopardize every one of those agreements with the Town, because that money has to come from someplace,” said Stettler County Reeve Larry Clarke.
“Everything from rec agreements to fire agreements to waste management, the list goes on and on. We work collaboratively to make sure we can offer these services.”
Even the lowest of the four options being proposed by the Province will result in a $3.5 to $4 million hit to the Stettler County coffers, with that number increasing yearly.
The yearly budget for Stettler County is $9.8 million, with around 65 per cent of that budget going to road maintenance.
These proposed changes are the second economic impact that the County has had to face recently. In 2019 the Government of Alberta already cut 35 per cent from shallow gas, resulting in a nearly $900,000 hit to the County’s bottom line.
“There’s been a couple blunders in between where the assessment numbers that were used for 2020 did not take into account the 35 per cent from last year,” said Clarke.
“In that, we ended up with almost another $400,000 in additional charges to our taxpayers for school taxes, seniors housing, and policing taxes, which we could not collect from these oil companies, because (that ability) had been removed last year.”
While the Town of Stettler will not feel a direct impact from these proposed assessment changes, if the County is forced to cut costs, the Town will definitely feel the hit as well.
“We’re in this together. What affects the County affects the Town; what affects the Town affects the County,” said Stettler Mayor Sean Nolls.
“We can’t be vibrant without the County, and vice versa.”
Clarke did say that if the worst-case assessment change is chosen, the County would work hard to “maintain status quo,” however doing so would require a 1.5 per cent increase on farmland tax and a doubling of residential tax - a move that is being decried by the Canadian Taxpayers Federation.
“The County estimates that the proposed assessment changes could result in $3 to $4 million in lost revenue and require ‘drastic cuts to services’ and ‘extreme’ tax increases,” noted the CTF in a recent release.
“However, if the County of Stettler merely brought their spending in line with the average mid-sized Alberta municipality it would spend $4.4 million less every year.”
The Rural Municipalities of Alberta (RMA), disagrees with those numbers, and it comes down to the roads. Unlike many jurisdictions, “RMA members manage over 70 per cent of the Province’s road network, despite making up less than 20 per cent of the population,” stated a recent RMA news release.
“Another way to consider the major role that roads play in driving rural municipal expenses is to consider the portion of total expenses municipalities spend on roads…to support industrial development.
“And the provincial government plays a smaller role in managing roads than provincial governments elsewhere.”
As for Stettler County and potential losses, the County only has two things to work with according to Clarke.
“One is services, and one is taxes to collect money. Our options with less money coming in are we either need to reduce services, or we need to tax the other taxpayers more so that they can receive the same services, and we can take care of these roads, except a lot of these oil companies could be driving on (them),” said Clarke.
By decreasing taxes on oil and gas companies, not only would they get a break but residents in other sectors would be further subsidizing them by paying more taxes to keep the roads going which they would ultimately be driving on.
“To me, giving anyone a tax break on any kind of land tax, it doesn’t increase business or increase jobs. In fact, it does the opposite,” said Nolls.
“I own a business and I pay a lot of land tax in town, and if my biggest problem is land tax I’m not running a good business. I support the oil and gas industry, but it feels like we’re always chasing them. It seems like we’re chasing an industry that wants nothing to do with us.”
A final decision on the oil and gas assessment model review will be made some time after the Legislature resumes sitting after summer break.