WHEREAS the 2001 report by the AAMDC Advisory Committee on Targeted Investment recommended that at least $6 million should be allocated annually to needy rural municipalities, and to date special payments from the Province have amounted to a maximum of $2.1 million annually; AND WHEREAS some seven years have passed since the demise of the unconditional Municipal Assistance Grant, and the province is now in a very strong fiscal position and is capable of fully funding the targeted investment program; AND WHEREAS municipal councils in numerous communities have taken considerable steps to rationalize expenditures and share services on a regional basis where practical, and in spite of these initiatives fiscal pressures continue to be severe; AND WHEREAS these municipalities face the same expenditures and challenges to provide municipal services as more fiscally advantaged ones; AND WHEREAS the infrastructure deficit in these fiscally challenged municipalities is growing at an even faster rate than other fiscally less needy communities, and this needs to be addressed further to provide a reasonable quality of life for the residents of the needy rural municipalities. AND WHEREAS unconditional funding of the Targeted Investment Program to an appropriate level is critical to address the fiscal pressures in the 18 needy rural municipalities currently identified by the province, and will do so in a manner that is not at the expense of more fiscally advantaged fellow municipalities;

THEREFORE BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties request the Government of Alberta to fully fund the Targeted Investment Program for needy rural municipalities on an unconditional basis as defined by the program criteria, commencing in the 2006 municipal fiscal year.

In 2001 the AAMDC adopted a proactive position on targeted investment to address the fiscal inequities of ‘needy’ rural municipalities characterized by: 1. Revenue generation abilities limited by the size of the local assessment base in comparison to the local population and the local road network. 2. Local ratepayers paying a higher than average tax rate in order to support the cost of municipal services A number of these rural municipalities also have had to assume the responsibility for providing municipal services and upgrading dilapidated infrastructure in a number of former villages that had to dissolve because they could not fiscally survive. It should also be noted that while the newly announced Alberta Municipal Infrastructure program supports all Alberta municipal districts and counties, it is conditionally funded on a per – capita basis. Most of the 18 needy municipalities identified are low in population and high in sparsity. All of these 18 municipalities have agriculture as their primary economic activity. In the County of Thorhild’s case for an example, the funding model recommended an annual payment from the province under the Targeted Investment Program in excess of $450,000 based upon 2001 dollars. To date, the largest special contribution received from the province to address the County’s limited fiscal capacity in any year has been $156,000 (2005). Although this funding is very much appreciated, it is still less than 35% of the recommended 2001 level and does not offset the $608,000 Municipal Assistance Grant received in 1993 that was eliminated. In light of the ongoing fiscal challenges faced by needy rural municipalities, the County of Thorhild supports targeted investment funding in line with the 2001 report recommendation.

Municipal Affairs has been able to fund this limited targeted investment initiative in the three previous fiscal years by allocating surplus ministry budget dollars. This program had never been a permanent line item within the budget. As part of the ten-year Municipal Sustainability Initiative, the Sustainable Investment Fund was established. A total of $15 million per year will be allocated to municipalities with a population less than 10,000 and limited local assessment bases.Through MSI, more money is being directed to municipalities in need now than when the Target Investment Program was in place.