As mentioned before, we are one big community who all use
services offered by all the municipalities in our area.
Residents from Hythe use the Beaverlodge pool
beside Beaverlodge residents, County residents from Clairmont quad in the Dunes
area along with City residents.
When I install
siding in Sexsmith, I use all of Sexsmith's streets to get around; farmers from
LaGlace use City streets to pick up supplies...the list goes on.
If everyone in the area gets to regularly use the
infrastructure and services on an equal basis, shouldn't everyone also equally contribute
towards the costs as well?
Unfortunately this is not the case right now.
There are a number of ways that we can analyze who is paying
what costs. The first way is to look at how much the municipalities are
paying for the cost of delivering services in the area. Between 2009 and
2012, $789 million was spent on municipal services in the GP region. Here's
how it was broken down:
Municipality
|
Total Expenses
|
% of Regional
Expenses
|
% of Population
|
City of GP
|
$515,621,098
|
65.4%
|
66.8%
|
County of GP
|
$227,081,101
|
28.8%
|
24.7%
|
Town of Beaverlodge
|
$18,835,413
|
2.4%
|
2.9%
|
Town of Sexsmith
|
$14,923,435
|
1.9%
|
2.9%
|
Town of Wembley
|
$7,007,001
|
0.9%
|
1.7%
|
Village of Hythe
|
$5,121,503
|
0.6%
|
1.0%
|
As we can see, each municipality is paying a share of municipal services that
is roughly equivalent to their population share, although the County does pay a
slightly larger piece. While in some spending areas, some municipalities
pay more, it generally balances out overall. For example, the City covers
around 82% of the region's Recreation & Culture costs, but this is offset
by the County who pick up about 37% of the region's Transportation costs.
Great! What's the issue then?
The issue arises when we look at how much each residential taxpayer is paying
based on which municipality they live in:
| Municipality |
Residential Taxes Paid |
Average Res. Tax per Dwelling |
% of Regional Residential Taxes |
% of Population |
| City of GP |
$63,772,526 |
$2,702 |
75.30% |
66.80% |
| County of
GP |
$15,674,556 |
$1,854 |
18.50% |
24.70% |
| Town of
Beaverlodge |
$1,832,191 |
$1,868 |
2.20% |
2.90% |
| Town of
Sexsmith |
$1,799,160 |
$2,004 |
2.10% |
2.90% |
| Town of
Wembley |
$901,989 |
$1,572 |
1.10% |
1.70% |
| Village
of Hythe |
$699,000 |
$2,118 |
0.80% |
1.00% |
*See note on
calculations at bottom of post
Here we see that City residents are paying a much greater share of all the
residential taxes that are collected in the area. In fact, the average dwelling
in the City paid $2,702 in taxes in 2012 compared to an average of $1,854 in
the County...an $850 difference.
But Rory, this doesn't make any sense. If the municipalities are paying
an equal share, but residents aren't, what's the deal?
Good question. Here are the answers:
1. Some municipalities have additional revenue streams that help keep their
residential taxes low.
2. Some municipalities have the provincial government pick
up the tab for a number of their services.
Let's look at each:
1. Revenues
In Alberta, there are two main sources of property tax that
the provincial government assesses and collects: Linear assessment and
Machinery & Equipment (M&E)
Linear assessment includes things like pipelines, oil &
gas wells, electrical transmission lines, and telecommunication towers. M&E
is the assessment class that includes industrial complexes like the
Weyerhaeuser and Canfor mills and large equipment like compressors and storage tanks. Municipalities get "rent"
essentially for having all this within their jurisdiction.
So who gets this money?
Let's take a look at 2012 numbers:
| Municipality |
Linear Revenues |
Linear Revenue per capita |
Share of Regional Linear Revenues |
% of Population |
| City of
GP |
$1,876,031 |
$34 |
7% |
67% |
| County of
GP |
$23,565,319 |
$1,158 |
92% |
25% |
| Town of
Beaverlodge |
$75,200 |
$32 |
0.30% |
2.90% |
| Town of
Sexsmith |
$140,971 |
$58 |
0.50% |
2.90% |
| Town of
Wembley |
$21,738 |
$16 |
0.10% |
1.70% |
| Village
of Hythe |
$0 |
$0 |
0% |
1.00% |
| Municipality |
M&E Revenues |
M&E Revenues Per Capita |
Share of Regional M&E Revenues |
% of Population |
| City of
GP |
$670,662 |
$12 |
5% |
67% |
| County of
GP |
$12,450,744 |
$612 |
94% |
25% |
| Town of
Beaverlodge |
$9,126 |
$4 |
0.10% |
2.90% |
| Town of
Sexsmith |
$45,911 |
$19 |
0.30% |
2.90% |
| Town of
Wembley |
$1,599 |
$1 |
0% |
1.70% |
| Village
of Hythe |
$0 |
$0 |
0% |
1.00% |
| Municipality |
M&E/Linear Revenues Combined |
M&E/Linear Revenues Per Capita |
Share of Regional M&E/Linear
Revenues |
% of Population |
| City of GP |
$2,546,693 |
$46 |
7% |
67% |
| County of GP |
$36,016,063 |
$1,770 |
93% |
25% |
| Town of
Beaverlodge |
$84,326 |
$36 |
0.20% |
2.90% |
| Town of
Sexsmith |
$186,882 |
$77 |
0.50% |
2.90% |
| Town of
Wembley |
$23,337 |
$17 |
0.10% |
1.70% |
| Village
of Hythe |
$0 |
$0 |
0% |
1.00% |
I don't really need to provide much commentary here. The inequality is quite mind blowing.
In addition to the Linear and M&E, municipalities
receive grants from the provincial government.
Again we see some major inequalities in how the grants have been dolled
out between 2009 and 2012:
| Municipality |
Provincial Grants Total |
Provincial Grants Per Capita |
Share of Regional Provincial
Grants |
% of Population |
| City of GP |
$104,377,975 |
$1,897 |
61% |
67% |
| County of GP |
$53,473,296 |
$2,628 |
31% |
25% |
| Town of Beaverlodge |
$3,697,644 |
$1,563 |
2.10% |
2.90% |
| Town of
Sexsmith |
$6,068,235 |
$2,510 |
3.50% |
2.90% |
Is it fair that one municipality receives nearly a third of
the provincial grants while having one quarter of the population?
As we can see, there are some major inequalities that exist
on the revenue side, leading to a greater residential tax burden for urban taxpayers.
2. Expenses
We also need to look at the expense side where inequalities
also exist. The biggest inequality right
now is in regards to policing.
In Alberta, municipalities under 5000 people and all MDs and Counties are not required to pay for policing;
the expense is paid for by the Province.
In contrast, the City paid $13.6
million for policing in 2013.
In other words, the City spent about $250 on policing for
every person living in the City, while our neighbours were required to spend almost
nothing (I say "almost" because the County does pay for 3 RCMP
officers to enhance what is given to them).
To conclude, there are some major inequalities that exist in
who pays for municipal services in the region.
Now, I do realize that this whole issue is not as cut and dry as I've
laid it out. For example, grants that
come to one municipality do benefit others.
Although the County received the grant for the Dinosaur museum, the City
and Towns will benefit from increased tourism in the area.
Also, I recognize that to support the pipelines and
industrial complexes, the County does have a little extra burden on its
transportation infrastructure. However, objective
evidence has shown that the extra revenues many rural municipalities receive
far exceeds the additional infrastructure costs. So while I don't think the goal should be
perfect equality, the scales are heavily tipped in the rural municipalities'
direction and changes are needed. I look
forward to sharing what those changes could be.
*I've included all the
residential property taxes that are paid in the given year for simplicity sake. If you look at just the portion that goes to
the municipalities and not the province, you find City residents are actually paying
79% of residential taxes vs. 15% in the County.
This goes to show that there are inequalities in who is paying for the
education and seniors lodging portion of our property taxes as well. This can be another discussion for another
day though...