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September 30, 2020 September 30, 2020

No surprise on budget: Bow Island mayor

Posted on March 3, 2020 by 40 Mile Commentator

By Justin Seward

Commentator/Courier

The UCP government released its spring budget on Thursday and the document contained mostly updates from the fall budget, according to Bow Island Mayor Gordon Reynolds.
Reynolds says the budget talked about MSI (Municipal Sustainability Initiative) and Grants in Place of Taxes (GIPOT) among other things. GIPOT is about Crown-owned properties being exempt from assessment and exempt from taxation and the province pays a grant that is equalled to the property taxes that would otherwise be levied on these properties.
GIPOT experienced a cut in the fall budget of 24 per cent and will be cut by another 32 per cent on top of that in 2020-2021.
“There were things that they said back in October that they would be doing in the spring budget and that’s just what they’ve done in terms of levels of grants,” said Reynolds.
Reynolds explained for the MSI “the capital portion is decreasing somewhat. The total budget amount in the program is $694 million. How that translates on an individiual basis, I don’t know if we’ve seen that yet.”
The change was already factored into the town’s capital budget after the change was announced in the fall budget.
In the 2020-21 the MSI Capital will be reduced to $628 million and the forecast has it reduced more to $525 million by the 2021-2022 budget.
MSI operating is $30 million for 2019-2020 and the 2020-2021.
Once the MSI program ends it will be replaced the Local Government Fiscal Framework at the end of 2022 and will have an anticipated budget of $860 million split between the muncipalities.
“In total it appears to be an overall increase but they haven’t negotiated with AUMA (Alberta Urban Municipalities Association)and RMA( Rural Municipalites of Alberta) as to what the formula will be,” he said.
Bow Island will also be affected by the province’s overall education tax increase.
“The overall Education Tax in Bow Island is 9.15 per cent based on the incresed rate of 3.2 per cent times the increased total assessment,” said Reynolds.
“Part of the increased total assessment is due to new construction. On an individual home or business basis. It will depend on whether the assessment went up or down as to where the Education comes in. At this point it is hard to say what the affect will be on an individual home or business owner.”
Reynolds says when you look at provincial expenses and revenues, specifically pertaining to the revenue side, that the government has to base it on a target oil price and there are now questions with the potential pandemic and seems to be having an impact on the markets.
“That’s some concern for all of us,” he said.
“I think at a local level some key programs for us in terms of infrastructure would be the water/wastewater program, they reduced that by $18 million. The other was Water for Life program. It has bumped up from the fall budget, about $11 million.”
Those programs often go for new infrastructure, added Reynolds.
The town alsorelies on the federal gas tax money.
“The gas tax fund money which comes to the province from the federal government as a share of gasoline taxes appears to be down significantly but in fact last year the Feds doubled that payment,” he said.
“I think we’re back to a normal level on it.”
The town used a Basic Municipal Transportation Grant fo roads which was cut.
Another cut Reynolds highlighted that was cut was the annual $500,000 pool of money for provincial-wide the Fire Service Training program to train firemen in volunteer departments.
“They’re saying fire services are a municipal responsibility and so the government has stepped away from that one,” he said.

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