Linear Taxation In equalities between Municipalities.

In Alberta you have in excess of 400 small municipalities, many are doing well with thriving economies and others are similar to the Crowsnest Pass in that they are struggling financially.

The provincial government allows Municipalities many ways to raise revenues such has property taxation, linear taxation, franchise fees, user fees, fine revenues etc. Most people understand property taxes, unfortunately in the Crowsnest Pass we have a very limited commercial tax base, so fast approaching 90% of property tax is collected from residents. Franchise Fees I am sure after the last six months most people know what they are. User fees are such things as the utility bill we pay every second month, ice time at the arena, rental of a municipal hall, etc. Fine Revenue we now have our own Community Peace Officers who some predict will bring us in large sums of money.

Lastly, there is Linear Taxation, from my conversations with people very few understand what Linear Taxation is. Real simple explanation it is the Tax dollars that CPR, power companies, gas or oil companies, windmills etc pay to be allowed to run their lines through your municipality.  

The Crowsnest Pass in 2011 brought in $587,000 in revenue from Linear Taxation which sounds like a lot, but it’s not when we compare to our neighbours  To the north we have MD of Ranchlands that brings in $4,000,000 a year in Linear taxation its area is large and a lot of oil and gas lines run through its municipality. To the east we have MD of Pincher Creek which brings in $3,000,000 a year just from windmills. Also keep in mind that these municipalities are very rural have little infrastructure and very few facilities to maintain. In simple terms costs are low and revenues high quite the opposite to the Crowsnest Pass.

You might think this situation is unique to the Pass its not, look at Cold Lake right in the middle of oil and gas country, one would assume that they are rolling in money. Over the last ten years that community’s population has more than doubled, putting tremendous pressure on its local government to build roads, put in water and sewer lines, build new facilities etc. You would imagine that they have all kinds of tax base, not to the degree they need most of that oil and gas development is taking place outside of their municipal boundaries, but all the people that are coming there are living in Cold Lake. They attempted to share revenues with the surrounding municipalities and had some minor success, not enough, they even went as far as to dissolve their municipality to force the province to assist them. George Cuff and his company went in did a report for the province the last I heard was that the province refused their request to be dissolved, they made some minor agreements with surrounding municipalities and the province told them to basically live within their means.

   

Back to the Crowsnest Pass, I sat on council for six years it became apparent after a few budget cycles that money is not something the Pass has an abundance of. We looked for other sources of revenue the administration pointed out the opportunity that sat to the North of us with Ranchlands. We met with Ranchlands administration and council a number of times and spoke to various ministers about moving some of those linear tax dollars towards the Crowsnest Pass. You can see how much success we had, maybe this council will have better luck with the powers to be in Edmonton and convincing our neighbours to the north to share with us. I hope so.   

Council is right, previous council was right and I am sure councils prior to the one I sat on looked at this issue. There is an inequality between municipalities on this linear taxation issue and there are municipalities that have much higher costs than others. But  I suspect if a municipality like the Crowsnest Pass was in the financial position of a MD of Ranchlands we would be telling them to get their financial house in order prior to coming to us cap in hand.