The details of property taxation are not straightforward. With assessments, requisitions and rates abounding, it’s enough to make an accountant’s eyes cross. The basic argument in favour of giving municipalities a bigger share of the take is not very complicated, however. Indeed, it’s simple to the point that it beggars belief that the Alberta government has not taken more aggressive steps forward.

The 2006 budget includes a slight reduction in the rate of property tax that goes to the province to pay for education. Good news, but municipalities around Alberta say that the government has not gone far enough. They call for further rollbacks until the total provincial requisition has returned to the amount it reached in 2001, when the Klein Tories originally informed municipalities that the education tax amounts would be frozen. If this were to occur, more than $200 million would be made available for municipalities. How would this money be spent? In almost all cases, on infrastructure. 

Alberta’s growth rate is staggering. A Statistics Canada survey suggests that in the final three months of 2005, the population grew by 25,000. Imagine five new Jaspers appearing within a period of 90 days. Of course, if you do paint that mental picture, you’ll probably include our paved roads, maintained green spaces and regular garbage service. The problem is that when these thousands of newcomers decide to make their homes in Alberta, the added strain is felt most acutely at the municipal level, where budgets are made based on careful population projections and where the coffers are not buoyed by the constant flow of oil royalties like the provincial treasury. 

Essentially, the more municipalities can squeeze from their ratepayers without actually increasing taxes, the better. One simple way to do this is to reduce the percentage of the tax load that must be remitted to the province. Of course, education has to be funded somehow, and as easy as it might seem to point to the multi-billion dollar surplus, raiding our reserves is not a sustainable mechanism for supporting an essential service. Instead, the money could be found in the scaling back of some elements of the grant programs offered by the province to support muncipal infrastructure projects. 

While grants are an essential element of the funding puzzle and should be retained on some level, they should not be seen as a means of providing a municipal contribution when none is available due to taxation saturation. Grants provide less flexibility and more bureaucracy. Allowing municipal governments the opportunity to care for their own specific needs is both more efficient and more economical.

Municipalities are closest to the issues of concern to their citizens. They should have the ability to set the agenda and spend their taxpayer’s money. It’s a simple argument, and for the provincial government, it should be a familiar one too. It’s a variation on the cant we hear every time Ottawa tries to attach conditions to health care funding.