A proposed new deal to fund municipal infrastructure in Alberta’s two largest cities would tie future money to the rise and fall in provincial revenues and to the carbon tax.
“(Calgary and Edmonton) are partners in growing Alberta’s economy and it’s about time we had an agreement that recognizes that,” Municipal Affairs Minister Shaye Anderson said Thursday.
“Revenue-sharing would ensure the cities receive more funding in the good times when revenues are growing, but also less when times are tough.”
Anderson introduced the changes in the legislature Thursday. They do not need legislation to be enacted and enforced, but Anderson said the government wanted to bring permanency to them.
READ MORE: Alberta government getting closer to finishing municipal funding program
“No other province has a legislated revenue-sharing agreement with municipalities like this, and no other province legislates long-term transit funding either, except for Alberta,” he said.
The proposed legislation, if passed, would see the funding deal begin in 2022 when current arrangements end.
Calgary and Edmonton would split base funding of $500 million for the first year. The amount would then rise or fall incrementally based on provincial revenues.
The bill also aims to enshrine into law current rapid-transit funding of $3 billion through to 2027. After that, $400 million would be made available a year from carbon tax revenue and split evenly between Edmonton and Calgary for transit.
READ MORE: Edmonton council holds ‘pivotal special city council meeting’ about budget and funding
Edmonton Mayor Don Iveson said having a funding model set in law is preferable to past programs.
“There’s a very important difference between a political promise and a law,” he said.
The mayor said there has been too much uncertainty, with changes to provincial fortunes leading to steep, unexpected drops in funding.
“From one budget to the next, we never knew where we stood,” said Iveson.
“Legislation gives us certainty that if there is a policy shift of government, that that has to be done with notice, that has to be done in public, and municipalities would have a chance to respond.”
READ MORE: How much will the 2018 Alberta carbon tax hike cost you?
The future of Alberta’s carbon tax, however, is uncertain.
Albertans go to the polls in an election in the spring. The Opposition United Conservatives have promised to kill the carbon tax by the summer if they win. They say it punishes families while failing to meaningfully address climate change.
Watch below – Oct 5, 2018: UCP leader Jason Kenney says carbon tax is the ‘biggest lie’ in Alberta history
Other parties have mused about making changes to the tax.
The bill does not address other options should the carbon tax be eliminated or fall short of the $400-million figure.
It also doesn’t specify whether the money would go to the municipalities with no strings attached or whether the province would have the final say on some issues.
Anderson said that will be hashed out later.
“Getting that baseline funding was the No. 1 important thing to get … in legislation as we promised for this fall,” he said.
“Going forward we’ll work with … the two big cities and get those details hammered out.”
READ MORE: Edmonton mayor unveils 5-point plan for city’s ‘toughest budget in a decade’
Iveson said the deal will mean an estimated $211 million in baseline infrastructure funding starting in 2022 — which will rise in future years as the province’s economy grows; $200 million annually in ongoing transit funding starting in 2027; and access to one third of a new annual $50-million regional program for joint infrastructure projects, starting in 2022.
Bill 32 is called the City Charters Fiscal Framework Act.
“We’ve been working towards long-term, predictable funding for Alberta’s big cities for many years,” Calgary Mayor Naheed Nenshi said.
“In order to be able to plan for the future and invest in areas Calgarians expect, it is critical that we have a level of financial certainty from the government of Alberta.”
Watch – April 27, 2018: Edmonton Mayor Don Iveson is frustrated that the provincial government isn’t making it clear how much money will be available down the road for some critical projects. Vinesh Pratap reports.
— With files from Emily Mertz, Global News