Alberta Municipal Affairs explains that the decision to freeze assessment modifiers was done to bring economic balance as industry recovers.
The freeze has cause concern from the municipalities. M.D. of Lesser Slave River reeve Murray Kerik said in a previous interview that this decision was made without consulting municipalities. The reeve also said that his freeze hurt municipalities financially.
Prior to the freeze, linear assessments were supposed increase. Once the freeze occurred this took away the money municipalities would have got. Kerik was not able to say how much this has impacted the M.D. at this time but he has pointed out that Yellowhead County lost $2 million.
These budgetary shortcomings could call into question any revenue or cost-sharing agreements between municipalities.
Lauren Arscott, press secretary of the office of Municipal Affairs, says that the province is looking to support the energy sector as it rebounds. This decision was made because the province knows how important this industry is to the economy.
Arscott says that after a rough couple of years, things are looking up for industry.
“We need to continue to provide stability,” she says.
With the focus on providing a continued steadiness, the province looked at the annual cost updates. This is what municipalities use to set property taxes. Arscott says these costs have fluctuated significantly for pipelines as well as oil and gas wells.
“These fluctuations have created uncertainty for municipalities and the energy sector,” she says.
Out of concern for the fluctuation, the provincial government decided to enact a freeze. This freeze covered wells and pipelines. The freeze sets the rates at the same level as they were in 2017.
Arscott says the province will conduct a review on the assessment model. This review will include the assessment process for wells, pipelines, machinery and equipment. She hopes the review will be done in a timely manner.
“We understand this is a pressing issue for municipalities and industry and we are working as quickly as possible to complete the review,” she says.
Arscott does not know when this review will be completed. She did say the province is looking to have it completed sometime in 2018.
To address the issue of there being no municipal consultations, Arscott affirms that it is Alberta Municipal Affairs’ policy to consult municipalities in decision-making. She says Municipal Affairs has a strong history of conducting what she calls “strong consultations with all of their stakeholders” and the assessment modifier freeze was no different. The decision was made after consulting multiple parties, not just industry and municipalities.
Arscott says it is all about finding a balance between supporting business and insuring communities have the necessary resources to succeed.