Minister of Municipal Affairs Shaye Anderson makes the tax credit announcement in front of hundreds of rural municipal politicians at the annual AAMDC meeting on Nov. 15. Image: Government of Alberta

Ponoka County pleased with tax break decision

Province announces credit for municipalities on a portion of uncollectable education taxes

It’s only a partial victory for counties and municipal districts, but a victory nonetheless.

Last week, during the annual meeting of the Alberta Association of Municipal Districts and Counties (AAMDC), the provincial government dropped a bit of a bombshell on councils by announcing a tax credit will be coming their way on the uncollectable education property taxes from oil and gas properties.

All municipalities collect education property taxes for the province, but have called on the provincial government for some sort of help when oil and gas companies either won’t pay or go bankrupt. Property taxes are still owed on facilities including pipelines, wells and plants until these are considered abandoned by the Alberta Energy Regulator, a process that can at times take years.

“I heard loud and clear during my visits to rural communities this summer that they are facing tax recovery challenges,” said Shaye Anderson, minister of Municipal Affairs in his speech on Nov. 15.

“So we made this a priority and worked with the Alberta Association of Municipal Districts and Counties to come up with this solution. I am proud that we are able to make a difference and support municipalities.”

What will be called the Provincial Education Requisition Credit (PERC) will be retroactive to 2015, when oil prices began to fall and the program will operate for five years, meaning it will conclude at the end of 2019. Application forms and guidelines will soon be available and the first application deadline is Jan. 15, 2018.

The decision was applauded by all AAMDC members, but especially Ponoka County, which has been hit hard in recent years with few companies going under.

“Ponoka County council was very pleased with the announcement,” said Reeve Paul McLauchlin.

“Minister Anderson and the associated committee looking at the issues definitely heard and responded to our concerns of an unwarranted burden to our ratepayers by this outstanding prepayment of uncollectable taxes from insolvent properties.”

Ponoka County officials confirmed their first application will be approximately $250,000 — made up mostly of amounts from the insolvencies of Waldron Energy and Quatro Resources.

The credit will be funded through the Alberta School Foundation Fund’s net asset fund and cap of $10 million per year will be placed on the program.

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