City to receive additional cash from province

The City has been given a boost in the amount of funding received from the province’s Municipal Sustainability Initiative.

The City will receive a total of $18,349,276. Of that $17,067,319 is in capital funding and $1,281,957 is in operational funding.

Last year, the City received just over $17.7 million.

“We were very pleased with the MSI funding announcement – both with the $475,000 increase as well as the three-year commitment. We need to be able to have predictable finding so that we can do longer term planning. This three-year commitment will remove some of the guesswork from our planning,” said Councillor Lynne Mulder.

“It is too early to say what the additional funding will be used for but we are certainly not short of projects. We had already allocated the anticipated MSI funds during our recent capital budget deliberations. It will be used for the Gaetz Ave. revitalization project, curling rink renovations as well as road maintenance and repair.”

All municipalities in Alberta (i.e., cities, towns, villages, summer villages, specialized municipalities, municipal districts, improvement districts and special areas), Métis Settlements and the Townsite of Redwood Meadows Administration Society are eligible for funding based on their MSI allocation.

Each year, municipalities are advised of their annual MSI grant allocation following approval of the provincial budget. Amounts are determined based on municipal populations, education property tax requisitions and kilometres of local roads and include base funding for all municipalities and Sustainable Investment funding for municipalities with limited local tax bases.

Since 2007, the MSI has provided $3.1 billion of long-term funding to enhance municipal sustainability and to enable municipalities to meet the demands of growth.

An additional $896 million is estimated for 2012-13; up $10 million from last year. Of the total MSI provided each year, $50 million is allocated to conditional operating projects. The remainder is to be applied to qualifying capital projects.

Municipalities can carry forward unspent operating funds into the next calendar year if they are unable to complete a project. Unspent capital funds may be carried forward a total of six years.

Councillor Chris Stephan said although the funding is good news, he still has some concerns about it.

“For the sake of the City of Red Deer’s 10-year capital plan, an increase to MSI is a good thing. However, for a province that is running yet another deficit, I have to question the rationale for yet another increase in spending and whether this isn’t just an election strategy to try to appease municipalities who have been frustrated for some time in trying to work with this government,” said Stephan.

“I am also concerned that this increase in funding will be used by the City to push forward capital projects that have no business being funded. For example, the museum is seeking $10 million for a storage facility, which has been approved by council in its 10-year capital plan. This amount of funding for this project is beyond irresponsible. We need to show respect for the taxpayers of this City and stop wasting their money.”

He added like the province, the City has its own financial mess to sort through, and throwing more money at it is not going to solve any problems.

“We need to reduce and control our spending as well as focus primarily on our core services that our citizens expect a high standard with including policing, fire/paramedics, roads, repair/snow removal, infrastructure, recreation, and parks.

“Our unsustainable administrative costs, which make up the lions share of our budget, offer little benefit to our citizens and need to be significantly reduced,” said Stephan.

“The issue is about being financially responsible with the public purse, and both the City and the province are failing in this regard. We need to look at our finances from a long-term perspective and clearly understand the impacts of our spending decisions and what type of legacy we are going to leave for our children and future generations.”