Iveson hopeful about fiscal relationship with province after meeting with municipal affairs minister

Edmonton Mayor Don Iveson expressed displeasure to the UCP's provincial budget, tabled Thursday, Oct. 24, 2019. Morris Gamblin, Global News

Mayor Don Iveson admits changes that the province unilaterally imposed on Edmonton and other municipalities won’t be fixed in the short term, however, after his one-on-one meeting with Municipal Affairs Minister Kaycee Madu, he’s hopeful a better deal can be had for future years.

The Kenney government has formally done away with the legislated agreement that Edmonton and Calgary worked years to get in place through the City Charter.

Technically, the Local Government Fiscal Framework Act was amended when Bill 20 was tabled. It’s an omnibus bill that repealed the City Charters Fiscal Framework Act.

Reached in Washington D.C., on Monday, Iveson described his meeting with Madu as a “frank but constructive” discussion.

“We had a good conversation where I expressed reservation about their unilateral approach to adjusting our fiscal framework, but suggested there is a better way forward,” he said.

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The big complaint both Iveson and Calgary Mayor Naheed Nenshi have has to do with changes to the deal that saw the big cities’ construction grants rise and fall at the same rate the province’s economy — on a one-to-one basis. That was cut in half last Thursday. Now, if the provincial GDP climbs three per cent, the size of the city grant increases 1.5 per cent.

READ MORE: Alberta budget 2019 includes cuts to cities, civil servants, universities

“It’s not really a revenue share because it will erode over time and fall behind, and now all municipalities are in the same boat — urban and rural, large and small,” Iveson said.

“We think there is a fix, and the minister didn’t say, ‘No.’ That was encouraging.

“There was openness to consideration and the exchange of some numbers and proposals, so that’s, I think, appropriate given that we do have a partnership that we do want to build on here,” Iveson added.

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“We are partners in growing Alberta’s prosperity and we simply want to share in the upside, and we are prepared on a one-to-one basis to share on the downsides as well.”

The new legislation also imposes the same type of deal on all municipalities.

The Alberta Urban Municipalities Association had been negotiating a separate agreement with the Notley government a year ago, however, time ran out prior to the spring election so the other cities and towns were left hanging in the balance when the election was called.

“I think we’ve done our part on the downside with all the cuts that we’ve taken, not just this year, but in previous years,” Iveson said. “I think the point is we would like to be partners on a one-to-one and fair basis going forward.

“I think a simple amendment to the legislation can reflect that. It doesn’t cost the government anything in the short term as it’s getting to balance. It simply rewards municipalities in the long term.”

Iveson pointed to two different rollbacks in funding totalling nearly 50 per cent.

“I think [Madu] heard our point and understood that there was a cumulative effect to all of the government’s decisions, and also that there was some injury to our partnership that is now an issue for all municipalities, having spoken to leaders from communities around Alberta and our association,” Iveson said.
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“I think we all agree, if we’re going to take the hit on the way down then we should be one-to-one partners in the upside and the downside going forward too.”

The Edmonton mayor also raised the issue of the Kenney government rolling back the amount of money it pays the city as a grant instead of paying property taxes on government-owned land. The cut is worth 25 per cent this year and a second 25 per cent next year. Iveson said that money is gone.

“They’ve already banked those savings [in the budget].”

“Our new municipal funding framework balances the needs of municipalities with our provincial priorities and fiscal capacity, and aligns with recommendations from the MacKinnon Report to get municipal funding closer to the national average,” Madu said in an email to Global News.

“This is the kind of fiscal responsibility Albertans expect to see from their government, and it’s what we’re delivering.”

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MacKinnon said Alberta’s grants to municipalities were 20 per cent higher than the average in other provinces with similar economies.

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