After last fall’s municipal election, new councillors in the town of Gibbons started the job dealing with an unexpected debt load of $15.3 million.
In February, the council notified its residents that it was at risk of insolvency and could lose its town status. However, the town has managed to pull itself slightly above water over the last few months.
“The previous administration and previous council left a pretty big hole for us to fill,” says Rick Henderson, mayor of Gibbons.
“All the reserves had been depleted.. we were living basically paycheque to paycheque.”
According to council, the finances are still being investigated but previous spending decisions around infrastructure are what mainly put the town of about 3,300 people in the red.
Some of those decisions include funding a traffic light installment of over $2.4 million, as well as the Heartland Station Commercial Shopping District that was roughly $4 million.
Henderson said the shopping district is a continual expense since it was never hooked up to the town’s sewage system. Gibbons has been paying roughly $15,000 monthly to have the district’s sewage drained.
“It’s not normally paid by a small municipality. It’s paid by developers or it is paid by the province,” says Gibbons town councillor Ashley Morrison.
“I think it’s pretty messy how they’re having to deal with it from the previous councillors that were in place,” said says resident Donnie Morrison. “The councillors that are in place right now are doing an amazing job.”
In February, council predicted that a tax increase of 50 to 100 per cent was needed in order to fix the town’s finances, along with adhering to an extremely tight budget.
To try and avoid that, the council hired Bloom Centre for Municipal Education — an independent company that specializes in municipal finances — to help.
Over the last few months the town has laid off five staff members, eliminated multiple vacant positions, and made deep service cuts.
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The council is currently in budget deliberations for 2026. Despite financial hardships, it’s expecting to finalize a balanced budget on April 28th.
“The Bloom team… has not only been able to balance our budget, but start to build our reserves back,” says Morrison.
“That right-sizing of service delivery coupled with looking at what are we paying for contractors, what are we paying for services and reducing and having a high scrutiny on those costs has really shown a tremendous impact.”
Some of the services taking a hit include grass cutting, road painting and pothole maintenance, as well the arena’s operating schedule — going forward, it’ll only be open during the winter months instead of year-round.
Youth programming and senior services will continue to operate as normal.
“The must-haves remain and the nice-to-haves will take the hit,” says Henderson.
The town asked the province for help and was given a $500,000 Alberta Community Partnership grant. Morrison says Gibbons hasn’t used any of the grant yet and is keeping it as a safety net.
It also negotiated to defer payments to the provincial government.
The Ministry of Municipal Affairs appointed Harold Johnsrude as official administrator to supervise the municipality and its council.
“The administrator’s role is to oversee the municipality, with authority to allow or disallow any council resolution or bylaw,” said the ministry in a statement.
“No bylaw or resolution that incurs a liability or disposes of the municipality’s money or property has any effect until the official administrator has approved it in writing.”
Gibbons also requested Municipal Affairs conduct a viability review of whether it’ll be able to keep its town status. Council has since requested to have the review paused, since it has a better financial outlook — but the review is already underway.
“I want to hear the voices of the folks in Gibbons so I’m going to stay out of that conversation. Let them have it and then we’re going to respond in government after we’ve heard what the citizens of Gibbons have to say,” said Municipal Affairs Minister Dan Williams.
As a part of the review, Gibbons’ resident will vote in June on if it should stay a town — but that vote is no longer binding under the newly passed Bill 28.
According to the legislation, regardless of the vote, the minister has the final say on whether the town loses its status and becomes a hamlet as part of Sturgeon County.
Gibbons is also looking to Sturgeon County for help.
“We are living right next door to the Industrial Heartland and yet we receive absolutely none of the tax revenue that comes out of the Industrial Heartland. All of that for this area goes to Sturgeon County,” Morrison said of the large industrial area northeast of Edmonton that’s home to upgraders and other large petrochemical complexes.
“We’re not seeing any of that and it’s time that we do, because we provide the urban services to those Sturgeon County community members.”
It’s a proposal for a revenue-sharing deal that Sturgeon County isn’t buying into.
“We do often invest in our neighbouring communities. It’s usually around a specific project,” said Sturgeon County Mayor Alanna Hnatiw.
“To simply choose one town out of the five in total that we have in Sturgeon County, and just start transfer payments without any discussion around governance or oversight of that, is not something that we’re interested in.”
Both Sturgeon County and Gibbons say they want conversations on how to work together to continue.
Gibbons town council predicts it’ll take roughly five to 10 years to regain full financial stability.
Towns must provide an annual financial report to the province. How can that get so fouled up in under a year? Someone in the province should also be fired.