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M.D. takes look at shallow gas tax relief

Posted on October 31, 2019 by Vauxhall Advance

By Cole Parkinson
Vauxhall Advance

With the Shallow Gas Tax Relief reducing property tax on shallow gas wells/pipelines for 2019, the Municipal District of Taber is taking advantage of the new initiative.

With 11 companies located in the M.D. listed for relief by the province, the M.D. council discussed the pros and cons of the new program at their regular meeting on Oct. 8.

Municipalities are asked by the provincial government to cancel 35 per cent of the total 2019 property tax on qualifying properties and subsequently will receive a credit equal to this amount.

Currently, 213 wells and 130 associated pipelines are qualified properties within the Municipal District of Taber and the total 2019 property tax levy for qualifying properties in the M.D. of Taber is $161,138.70, which will result in the cancellation of $56,398.54 in 2019 property tax.

The 11 companies and the total amount of Shallow Gas Tax Relief is Wolf Coulee Resources ($614.18), Crescent Point Energy ($19.14), Sanling Energy ($22,536.01), Little Rock Resources ($8,290.09), Baytex Energy ($1,263.79), Canadian Natural Resources ($8,290.09), City of Medicine Hat – Gas Utility ($462.16), Houston Oil and Gas ($5,353.49), Sphere Energy ($12,334.04), Surge Energy ($323.69) and Zargon Oil and Gas ($3,049.99) for a grand total of $56,398.54.

“Are some of these ones that are not paying their taxes now? So in essence, are we going to get 35 per cent of something that is not being paid already?” asked Coun. Brian Brewin.

Coun. John Turcato stated he knew of at least one of the listed companies had not paid taxes.

“Giving someone an exemption who currently isn’t paying their taxes seems a little counterproductive,” he added. “That would be my question to (the province). If some of these aren’t currently paying their taxes, why are we giving them an exemption?”

While council agreed with the point brought up by Turcato, they also realized a bit of financial help coming back to the M.D. was hard to pass up.

“That is one of the incentives for municipalities. You are going to get something when you probably weren’t getting anything,” said Brewin, who also stated he had heard other municipalities had indeed declined. “The feeling is kind of all over the board on this.”

Other councillors were also more on the side of getting some money back from the initiative.

“I get the ethics of giving a reduction but I think as a municipality we would be remiss not to try to get our money,” said Deputy Reeve Tamara Miyanaga.

“I do think John has a good point,” said Coun. Jen Crowson.

“The government looks at the bigger picture of giving these tax breaks but they should be looking at the companies that are paying their bill. Why should we be giving deals to those not paying their bills to begin with?”

While Turcato pointed out the bad precedent this may set, he also realized the financial situation regarding oil and gas was less than ideal.

“There are different ways of doing these things. I just think this is a poor way of doing it. I think it is a terrible precedent to set but because they are giving this reduction, we have to take advantage of it. We have no choice,” he said.

Administration recommended to cancel the 2019 property taxes owing to reduce by 35 per cent property taxes levied for all properties identified in the amount of $56,398.54.

A motion was made to follow administration’s recommendation and was carried unanimously.

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