Red Deer and Lacombe County representatives are defending their spending after being called out by the Canadian Taxpayers Federation.
Alberta director Franco Terrazzano singled out the two central Alberta counties on Wednesday, saying they and a number of other Alberta municipalities should slash their budgets before considering tax increases to compensate for lost oil and gas revenue.
“Counties need to cut spending before crying poor and threatening struggling families and businesses with massive tax hikes,” said Terrazzano. “If both counties brought their spending in line with their peers then they wouldn’t need to be grasping for more tax dollars.”
Alberta’s rural municipalities are dismayed by proposed changes to oil and gas assessments that could strip millions out of county and municipal district budgets. Red Deer County projects it could lose $4 million and Lacombe County $2 million under the scheme designed to bail out oil and gas companies.
Making up the lost revenue solely by boosting other taxes would see Red Deer County ratepayers facing the equivalent of a 30 per cent tax increase. In Lacombe County, residential taxes would have to go up 39 per cent to cover the shortfall if no other financial changes were made.
A Canadian Taxpayers Federation report says Red Deer County would spend $12.7 million less and Lacombe County $13.7 million less if spending was in line with the average of Alberta’s mid-sized municipalities.
Lacombe County Reeve Paula Law does not dispute the taxpayer federation’s math but says it does not present an accurate picture of the municipality’s finances.
“It’s really not comparing apples to apples,” said Law on Thursday. “It’s very difficult to compare municipalities and their services and the costs of other municipalities.”
What services a community offers, its population and geographic size all play a part in determining budgets, she said.
“We do have concerns with the inference they’re making that Lacombe County is over-spending.”
Lacombe County is large and maintaining and improving its nearly 2,200 kilometres of roads eats up about 70 per cent of its budget. The county also contributes to urban municipalities within its borders, such as providing a share of recreation costs, she added.
“The information is in the details. The whole story isn’t being told.”
Law said Lacombe County has no debt and council is managing finances well, balancing the services people want against available taxes and other revenue streams — which are likely to get smaller if changes such as the oil and gas assessments go through.
Red Deer County Mayor Jim Wood also suggests the taxpayer federation’s report picks and chooses among financial statistics.
“The Canadian Taxpayer Federation has chosen one metric in isolation and has been narrow in its use,” said Wood.
Red Deer County covers more than 4,000 square kilometers, includes 85 subdivisions, 12 industrial parks, and more than 3,000 kilometres of roads and bridges — all of which has to be maintained and improved.
When using spending per kilometre of road as a standard, the county’s $25,000 per kilometre stacks up well against communities such as Chestermere, which spends more than $300,000 per kilometre.
And the benefits of spending by Alberta’s rural municipalities are felt outside its borders, he added.
“Industry is a heavy user of our infrastructure. The infrastructure built and maintained by counties allows industry to generate wealth for all Albertans.
“For example, bridges were built by the province but their repair, maintenance, and replacement has been downloaded to rural municipalities.”