Contradicting messages between old and new government cause county deficit

Miriam Ostermann
Times Associate Editor

 

Unconventional promises made by the former government that influenced Wheatland County’s budget decisions were revoked at the end of July and dismissed as an advance rather than additional funds by the new provincial government. Staring down a $322,722 capital shortfall the municipality is now likely forced to dip into reserves.
In a letter from former Progressive Conservative Minister Diana McQueen dated March 25, Wheatland County was informed that a significant additional funding allocation to the 2014 Municipal Sustainability Initiative (MSI) Capital program was confirmed on March 6. With an additional $398.9 million planned to be injected into the Alberta municipalities’ infrastructure needs and priorities, the county welcomed the offer of over $1.5 million as they headed into their budget process and used the allocated grant funding to prepare their final budget for 2015, in April. The extra cash allowed a cushion to fund the paving of township road 232 – which has already been completed – the Gleichen water treatment with costs of $375,000, the Rosebud Grader Shop at $383,000, and Carseland Genset with costs of $10,000.
However, a letter from the current Minister Deron Bilous from July 27 stated that the capital funding allocated in March 2015 will be added to the current capital allocation of the 2015-2016 MSI program budget.
“Our budget was set in April so we had that information, some of the bigger centres set their budgets in December and they stick to that budget so they wouldn’t have known of that increase,” said Alan Parkin, the chief administrative officer for Wheatland County.
“We took that letter and thought, ‘hey this is good, we’re getting an increase.’ Our funding levels have actually increased over the years for the MSI, so our funding levels haven’t decreased. They made that special announcement in March they were going to have an increase, and we trusted their word in that letter.”
The initial funding for the MSI Capital Fund showed that with the additional funds revealed in March, Basic Municipal Transportation Grant, MSI Capital, and MSI Operating resulted in a funding total of $5,863,420. The revised MSI funding in July, in turn, considers the $1.5 million an advance and deducted the amount from the MSI funding to result in a total of $4,208,604. As the $1.5 million fund was not received by the county previously, the county is left with a $322,722.90 deficit in need of financial attention, once the funding and other funds contribute to the budget. According to Parkin, the municipality will overcome the obstacles and most likely turn to reserves to fill the financial gap.
“I think it’s been an excellent funding source for the municipalities,” Parkin said. “It’s been really good to receive funding from the province , we’d just like to ensure that there’s a little bit more stability to it.”
Wheatland County wasn’t the only municipality receiving the disappointing news. Strathmore was also expecting an additional $1 million, while Calgary was informed about an additional $120 million and Edmonton was told they would receive an additional $80 million top-up. Unlike the county, however, their budgets are determined at the end of the year and the actions, therefore, had less of an impact for the municipalities going forward.
“We had not contemplated additional spending of this million dollars, and so the fact that the province said yes there is an additional million dollars and not here is not an additional million dollars, really didn’t affect us because we had already put our plans into effect based on numbers without this million dollars,” said Mel Tiede, director of corporate services at the Town of Strathmore.
“To us it’s a non-issue for us. It’s disappointing from the standpoint that yes we could’ve used another million dollars. There are things in the town that are a priority that may not get done now for another year down the road. But it is what it is, and we have to live with the funding that the province has for us.”
For now, Wheatland County council is actively working on arranging a meeting with the minister in the fall.