Municipal Sustainability Initiative cut by 25 per cent

Cuts to the Municipal Sustainability Initiative (MSI) in the Alberta Government’s proposed 2009-10 budget means the town of Jasper could lose funding over the next decade.

“MSI funding, over the next ten years, is projected to be our major revenue source for capital programs,” said municipal manager George Krefting.
Grant money increases and decreases with the economy, and MSI funding is expected to decrease by nearly 25 per cent.

“That’s a big number for us,” Krefting said. “We were expecting to receive about $2.6 million a year for the next ten years from that program and so if it’s reduced by 23 per cent. That could be a reduction of $500,00 or $600,000 a year.”

At the same time, he added, there was good news for the town in the federal budget.

“The federal gas tax was doubled and that takes effect immediately,” Krefting said. “For the municipality that means about an extra $260,000 a year that we’ll be getting for our capital funding. So from the federal side we gained some money but from the provincial MSI it appears we’re going to lose some.”

For the Municipality of Jasper, which does its capital planning six years in advance, the announcements means the town will have to go back and take another look at its plans.

“The federal budget announced a number of new initiatives for infrastructure so what we’ve done this last week is assembled a list of projects that are in our capital plan,” Krefting said. “We are hoping to access some of the additional grant money announced in the federal budget this last week.”

Proposed changes to arts and culture funding are also making non-profit and volunteer organizations nervous.

In a move toward “streamlining the grant application processes to reduce the administration burden,” the Wild Rose Foundation, a source of funding for non-profit organizations which has been in existence for a quarter century, will be absorbed by the Community Initiatives Program.

Marianne Garrah, an arts and culture advocate who lives in Jasper, said she expects the change will result in just the opposite. “It means a lot more searching, a lot more mini-funds,” Garrah said. “Instead of one big fund for an initiative, the funding will have to come from many places now.”

This year’s provincial budget, tabled by Finance Minister Iris Evans on April 7, reflected a $4.7-billion deficit, the largest in Alberta’s history, after collapsing energy prices flopped 15 years of surpluses into two consecutive deficit budgets.

For the current year, Evans had originally forecast a $1.6 billion surplus but 2008-09 will finish with a $1.4 billion deficit.

Other highlights include an immediate tax increase for alcohol ($1.30 on a 12-pack of beer, 75¢ for wine and $2.89 for most spirits) and tobacco ($3 per carton), the elimination of $200 per person per year of chiropractic coverage, and cuts to municipal project funding of $100 million.

If revenues don’t rebound, the provincial government will reportedly be required to find $2.2 billion more by cutting spending, increasing taxes or both.