Provincial budget supports the City’s budget, officials say

  • Apr. 1, 2015 3:40 p.m.

Following last week’s provincial budget announcement, City of Red Deer officials believe the current 2015 Capital Budget is stable, and will move forward with projects identified this year.

Over the next five years, there will be $7.9 billion in municipal infrastructure support, across the province, through the Municipal Sustainability Initiative (MSI) and other programs.

Red Deer’s 2015/16 allocation will include $9.7 million in MSI funding and $6.2 million in Basic Municipal Transportation Grant (BMTG) funding.

This is a 35% decrease from the $18 million in MSI funding and $6.1 million in BMTG that the City saw in 2014.

This is offset, however, by an $8 million MSI injection that was announced on March 6th.

“The MSI cut identified is neutralized by the $8 million MSI injection that was announced by the Province at the beginning of the month, enabling us to minimize the impact for the upcoming fiscal year,” said Mayor Tara Veer.

“However, while preliminary projections indicate that MSI funding may rise to previous levels in future years, we know that is entirely dependent on future provincial financial health, so we cannot predict what that will mean for 2016 and beyond.”

The Province also identified increases in transportation funding as well as $3 million in library funding and a continued commitment to fund Family and Community Support Services (FCSS).

“I am pleased to hear that the Province remains committed to keeping the Michener Centre open and that our community will still see the provincial funding that is required for the development of a multiplex at RDC, which is identified in our community amenities plan to host the 2019 Canada Winter Games,” said Veer.

Finance Minister Robin Campbell also spoke to healthcare levies, education cuts and increased insurance fees. “We cannot predict how these changes will impact our community overall as we have yet to see exactly how some of the changes will be rolled out,” added Veer.

Meanwhile, Campbell said Budget 2015 balances spending restraint with revenue enhancements and will use savings in the Contingency Account to address the province’s fiscal challenges. Alberta’s revenue is forecast to be $43.4 billion down $5.6 billion from the 2014-15 forecast of $49 billion. Resource revenue is forecast to be $2.9 billion; $5.9 billion lower than 2014-15. This is the lowest amount of resource revenue since 1998-99.

Other highlights included the addition of two new tax brackets for individuals with taxable income of more than $100,000 and $250,000.

Alberta will also introduce the Health Care Contribution Levy effective July 1st that will apply to individuals with taxable income of more than $50,000. The levy will phase-in depending on a person’s income and will be capped at a maximum of $1,000 in 2016 for Albertans with taxable incomes of more than $130,800.

This levy will apply to roughly 1.1 million Albertans and generate $396 million in 2015-16, rising to $530 million in new revenue when fully implemented in the 2016-17 fiscal year.

The province will also use its savings from the Contingency Account to balance off the forecasted deficit of $5 billion.

Not everyone was pleased with the government’s budgetary plans. Trevor Harrison of the Parkland Institute called it a missed opportunity to make the structural changes necessary to stabilize revenues and equitably wean the province off its overdependence on resource revenue.

“Minor tweaks to the income tax regime for the highest income earners will have negligible impacts on Alberta’s long-term fiscal picture, and will leave Albertans on the rollercoaster of oil prices for years to come,” he said.

Alberta Liberal Leader David Swann said, “The PCs are calling this budget ‘Putting Things Right’, but Albertans should remember who put things wrong in the first place.

“After 44 years in power, this government has a 10-year vision for higher debt and taxes, more user fees and fewer services. Education funding will neither keep up with inflation nor population growth.

“Classroom overcrowding will only get worse as no new teachers will be hired and more students are expected to attend. Parents are going to be asked to pay even more for their children’s education by increases in education property taxes, school fees, and transportation costs,” he said.

“Albertans will have their pockets picked by a plethora of new user fees and taxes. We will no longer be nickeled-and-dimed at every corner, but loonie-and-toonied from the cradle to the grave.

“Shockingly, the government has not learned from past disasters,” he said. “It has decided to slash the emergency budget by 50 per cent, reduce resources for flood mapping and cut funding to combat climate change. There has been absolutely no thought given to protecting taxpayers from future disasters by implementing a flood insurance program.”

Heather Forsyth, former Wildrose interim leader, said, “Mr. Prentice has had three budgets in three months, and this is just his pre-election budget.

“The real budget will come after the election and will either include meaningful reductions to spending that the Wildrose stands for, or a PST that Prentice has waffled on packaged with higher taxes.

“If this is the real budget, and not just a pre-election ploy, Prentice should debate it, pass it, and not break our fixed-election law until 2016.”

-Weber

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