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Questions continue for assessment changes

Posted on September 24, 2020 by Vauxhall Advance

By Cole Parkinson
Vauxhall Advance

As questions around changes to the Alberta assessment model continue across the province, some questions have been answered for the Municipal District of Taber.

As the reeve and administration was able to meet with Tracy Allard, Minister of Municipal Affairs, early in September, they were able to bring back a few answers to council.

“What I got from the meeting was she is not prepared to move this forward right now. She has heard, and she said we were quite nice in the south, the north wasn’t quite as nice. They were more vocal in their opposition to this. They are going to look at it and perhaps there are other ways of achieving the same thing without downloading this on to municipalities,” said Reeve Merrill Harris at the M.D.’ of Taber’s regular meeting on Sept. 8.

With no timelines set, council questioned how soon these decisions would come down.

“Are they going to start over with the process, or are they going to use some of the information they have and gather some new information? Having an idea of when the timing might come and taking the opportunity to have discussions with government on what avenues they might be looking at, that may be beneficial for municipalities,” added Coun. John Turcato.

Administration also pointed out no official word was sent down to municipalities yet and no firm timelines have been set in place since concerns have been raised by a vast number of Alberta municipalities.

“They are looking at a general timeframe at the beginning of October of trying to get to a go forward point with people involved. I do not believe it is written in stone and that was the sentiment that was shared. They did share no decisions have been made to this point,” stated CAO Arlos Crofts.

Council also reviewed potential impacts of the Assessment Model Review with proposed scenarios A through D which illustrate the possible impacts each scenario would have had on 2019 property assessments and 2020 tax revenues, with examples for residential, non-residential, and farmland example property in the M.D. of Taber.

It also shows possible tax increases if the tax revenue losses were recouped by a given percentage increase to all four assessment class municipal tax rates in 2020.

“When we are comparing this memo to information we receive from RMA, it isn’t always apples to apples simply because we don’t know the information the province is using as they developed their scenarios. So what our assessor has attempted to do is use the most recent information we have, adopting those principals and scenarios from the province, to many give us a better idea as to how this will impact the M.D. of Taber. The impact is still real in terms of significance,” explained Crofts. “There are also scenarios run in this as it relates to taxation and revenue generation that are purely hypothetical. Just ebbing used to demonstrate the impact of the proposal.”

“In the first half of 2020, an Assessment Model Review group was hosted by the provincial government to review the property assessment of DIP pipeline, DIP wells, and DIP M and E at well sites. The stakeholders at the table were oil and gas industry lobby groups, RMA, and AUMA. The end result of the provincial government’s consultation process with the involved stakeholders was the proposed Scenarios A through D. Municipal Affairs produced the before and after 2018 Assessment values for the DIP pipeline, DIP wells, and DIP M&E. The before value for the DIP — M and E was incorrect for the M.D. of Taber, and other municipalities had incorrect values as well. Municipal Affairs would not provide any background data or evidence to show how they came up with the ‘after’ assessed values for each scenario, though it is known that Industry stakeholders separately provided Scenario D, the worst-case scenario,” reads administration’s report.

Scenario A through D sees DIP M and E well sites at -30.34 per cent while DIP wells are -38.32 per cent (A), -55.86 per cent (B), 55.67 (C) and -60.05 per cent (D) while DIP pipelines are -45.63 per cent for A and B, -45.35 per cent (C) and -47.58 per cent (D).

Reduced overall assessment for scenario one is -13 per cent which results in $2,779,860 in reduced municipal tax, scenario B is -15 per cent which results in $3,308,492 in reduced municipal tax, scenario C is -16 per cent which results in $3,348,041 in reduced municipal tax and scenario D is -17 per cent which results in $3,656,629 in reduced municipal tax.

Council continued to speak against the proposed assessment changes along with the tax revenues as the amount of revenue lost for municipalities in the province will be massive.

“Any taxes we levy, we have no guarantee of collecting because we are not seen as secured creditors. Until that is fixed, I don’t think they should even be looking at an assessment model review. They have to come together because if they don’t, it’s a huge failure. I believe as a municipality we can deal with one of the other, we can’t deal with both,” said Turcato. “The reason we can’t deal with tax cuts is that we have no guarantee of collecting. Once they cut these taxes, we have no guarantee of collecting the ones we have cut. People can just choose not to pay their taxes in this class and not be held accountable. They could sell their business and sell these wells to another company with never having paid the previous taxes. That is a huge mistake in our model of assessment in tax collection.”

A motion to draft a letter to municipal affairs on the tax collection issue and assessment model changes was carried unanimously.

Coun. Brian Brewin was absent from the meeting.

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