Provincial budget impact Municipality
The 2013 Alberta Budget was announced on March 7, 2013. It appears as though there will be some significant impacts to grant funding received from the Alberta Government for Municipal operations, capital projects, as well as funding for community groups. The 2013 Alberta Budget also includes increases to the education property tax mill rate for residential and farmland properties.
The 2013 Alberta Budget also included an increase to the education requisition for residential and farmland properties. The total education requisition increased from $4,880,794 in 2012 to $5,207,141 in 2013, a $326,347 increase. Of the $326,347 increase, $236,342 is attributable to residential and farmland properties. This results in an 8.9% increase to the education mill rate on residential and farmland properties. By virtue of this education requisition increase, an individual farmland property can expect a tax increase of 2.2% and residential properties will see their property taxes rise by 3.5% if the municipal mill rates remain unchanged from 2012.
Due to the Education Property Tax increase most residential properties will still see a slight increase in their taxes due to the education property tax increase decision made by the province. Other properties will see an increase due to our ongoing re-assessment process to ensure equity of market value assessments attributable to residential property. If you have concerns about the decision by the province to increase the amount of Education Property Tax on your property please call them at 310-0000 and then dial 780-422-7125.
In 2013 the M.D. will collect approximately $18,400,000 in property taxes – 26% of that total is Education Property tax. Currently 32% of Alberta Education’s budget is derived from property taxes. At one time this used to be 50%. We are not sure what is in store for future Education Property tax requisitions from the province. Education Property tax generally accounts for between 40-50% of your total residential property tax bill within the M.D. of Taber.
In the past the Municipal District of Taber has received significant funding from the Alberta Government, which has allowed us to complete many worthwhile capital projects. These projects include water treatment plant upgrades, waste water lagoon expansions, replacement of water mains and new loop lines, as well as numerous roadway upgrades and resurfacing that has added many years of life to aging municipal infrastructure. Unfortunately the 2013 budget has not funded important capital funding programs including the Resource Road Program and the Local Road Bridge Program.
The issue of lack of capital funding for bridges is a critical one. The M.D. of Taber maintains 172 road bridges with a historical cost of $107 million dollars and we require approximately $13.5 million in bridge replacement work over the next 10 years and approximately $50 million over the next 25 years to maintain this network of bridge structures.
Although we are grateful that the 2013 Alberta Budget continues to provide grant funding for many needed municipal capital infrastructure projects we are concerned that the growing infrastructure deficit with respect to bridges will seriously impact our transportation network over the next decade without a concerted effort by the province to address it. Individuals within the bureaucracy of Alberta Transportation have suggested that he M.D. has too many bridges and that many of them should be removed which would mean that rather than a bridge every mile on North / South roads maybe a bridge every second/third or fourth mile would be more economical. Council has soundly and vigorously opposed these ‘suggestions’. With the intensity of irrigated agriculture a bridge every mile is an expectation – not a luxury.
During 2013 the M.D. will be undertaking substantial work on over 90 kilometers of road. Major culvert replacement and maintenance will continue as well. We continue our work on developing residential lots in hamlets in an attempt to keep as much residential housing off of farmland as possible. In addition the planning for light industrial lots in Vauxhall continues. We are aware of a number of private developers who are likewise planning light industrial lots in the Taber area to answer the increasing demand from businesses.
Agricultural commodity prices have been a bright light in the economy lately. I read a blog recently by a gentleman named Marc Faber who provided a ‘January 2013 Market Commentary’ which included an attachment titled ‘It’s time to bet the farm on farming and farmland’. In addition ‘The Daily Reckoning’ blog by Bill Bonner and Addison Wiggin provided 5 reasons why investment in agriculture is a good idea right now: grain inventories have fallen to their lowest inventory in 40 years, grain consumption is on the rise (word consumption now at 2600 bushels per second), arable land per person is falling (1.2 acres per person in 2006 vs 2.8 acres in 1960), biofuels are driving up ag demand, low water supplies is cutting down on production (China feeds 20% of the world’s population on only 10% of its arable land with only 6% of the world’s available water)– if there is a crop failure a 5% increase in grain demand by China could swallow up all of the grain that is exported by grain exporting nations.
Let’s hope that agricultural commodity prices stay strong for the long term, and that what we are seeing is not just another artificial bubble. There is no substitute for food – demand should remain strong.
Here’s hoping that we have a great year with strong prices, timely rain and lots of southern Alberta sun.
Brian Brewin, Reeve