County of Stettler No.6 sign on Hwy. 11. FILE PHOTO

County of Stettler questions payment of taxation on delinquent oil and gas companies

The County has sent a request to the Minister of Municipal Affairs to look into this issue.

The County of Stettler No. 6 has sent a written request to Shaye Anderson, Minister of Municipal Affairs to act upon immediately regarding a long-standing issue.

Although, not new, and a problem it has been facing for several years now, the county is obligated to collect and remit School and Seniors Housing Requisition Taxes on behalf of the provincial government.

“The county is required to remit these requisitions to the province regardless of whether the county itself has received payment of these requisitions by the ratepayers,” said Yvette Cassidy, assistant CAO. “In many cases, the oil and gas company ratepayers have become insolvent and the county has been unable to recover the significant School Tax and Seniors Housing requisitions levied by the provincial government against these companies. This is not just the County of Stettler’s hardship, it is affecting municipalities across our province, some more than others.”

According to Cassidy, the mandatory School Tax and Seniors Housing requisition remittance for these oil companies is paid to the provincial government out of the municipality’s operating budgets, because of the county’s inability to collect these remittances due to the hardship faced by some of the county’s oil and gas companies.

From 2013-2016, the County of Stettler was obligated but unable to collect and has since then forwarded $260,882.28 in School Tax requisitions and $27,826.29 in Senior Housing requisitions to the Alberta Government on behalf of oil and gas companies.

“And these are all companies we have been unable to collect from, and as a result, this remittance had to be paid out of our operating budget, which comes from rural taxpayer’s pockets,” Cassidy added.

Reeve Wayne Nixon said, “School Tax and Seniors Housing requisitions are vital to maintaining the fabric of our standard of life here in Alberta. By forcing Alberta municipalities, including the county to undertake the collection of School Tax and Seniors Housing requisitions on behalf of the province, and thereby force municipalities to assume the risk that these amounts will be unrecoverable, the province has forced taxpayers within our county to carry the burden of the province’s debts.”

This issue was brought forward by Councillor Greggory Jackson on behalf of the County of Stettler in the fall of 2016 at the Alberta Association of Municipal Districts and Counties (AAMDC) convention, and also, in a meeting that the county had with then Minister of Municipal Affairs, Danielle Larivee.

The County of Stettler had raised this issue again at the spring AAMDC conference in March 2017, and again, in a meeting with Minister Shaye Anderson in March.

“We are now facing a further predicted loss of $174,367 again in 2017 as we prepare School Tax remittance plus an additional $21,534 in Seniors Housing remittance, for several oil and gas companies already in arrears,” Cassidy stated. “Yet we remain obligated to use our operating budget to cover these uncollectable requisitions, placing the burden on our families and our community.”

In light of these challenging circumstances faced by the county, they have requested the following:

That the Minister consider reimbursing the county for uncollectable School Tax and Seniors Housing requisition remittances from 2013-2016 totalling $288,708.57; and moving forward the county should no longer carry the responsibility and burden of paying the province’s School Tax and Seniors Housing remittance on behalf of delinquent oil and gas sector industry.

Furthermore, the county believes that the continuation of Municipal Affairs Assessment Services Branch to allow for the taxation of properties they know, or should know, are in insolvency or under protection, is improper. Municipal Affairs Assessment Services Branch is intentionally and deliberately passing on a provincial debt to a municipality, knowing it will be unable to collect on that bad debt.

“We respectfully request more principled action from our leaders,” Reeve Nixon said. “We have also asked that future amendments to the MGA and other provincial legislation be considered to improve the ability of municipalities to recover unpaid taxes levied against oil and gas operations and the associated machinery and equipment and linear property.”