On March 16, 2017, the Government of Alberta released their budget for the 2017-18 fiscal year (April 1, 2017 to March 31, 2018).
The 2017-18 Government of Albert’s fiscal plan focuses on three strategic priorities for this budget:
- Making life more affordable;
- Creating jobs and a diversified economy;
- Protecting and improving services;
For a full breakdown of the budget and estimates, visit the Government of Alberta’s Budget 2017 webpage.
Budget Highlights
The following are details of the 2017-18 budget that will be important for AAMDC members:
- The Government of Alberta will operate at a deficit of $10.3 billion.
- The Municipal Sustainability Initiative (MSI) is funded at a total of $1.211 billion. The MSI is also expected to be funded at similar levels for the next four years even though the MSI program has technically expired.
- The MSI capital component is maintained at $846 million for the 2017-18 budget year.
- The MSI operating component is maintained at $30 million for the 2017-18 budget year.
- The Basic Municipal Transportation Grant is funded at $335 million, a $24 million reduction from the previous year.
- The Strategic Transportation Infrastructure Program (STIP) has received $35 million for 2017-18, with a combined $65 million targeted over the following two budgets.
- Indigenous Relations has included several strategic initiatives aimed at increasing collaboration between Indigenous organizations and other governments, including municipalities, in areas such as economic development and improving socio-economic outcomes for Indigenous peoples.
- Alberta Transportation has introduced the Alberta Community Transit Fund, and funded it at a level of $40 million for 2017-18. The AAMDC will share program details with members as they become available.
- To transition towards the centralization of industrial assessment, Budget 2017-18 allocated $3 million which will be handled within Alberta Municipal Affairs.
- Rural economic development funding has increased by 28% to $53.2 million for 2017-18.
- Wildfire management funding has increased by 13% over the previous budget to $97.9 million.
- Funding for wildlife management is $22.4 million in Budget 2017-18, an increase of 118% over the previous budget.
- The carbon levy is estimated to raise $1.03 billion in 2017-18 and $1.3 billion by 2018-19.
The attached backgrounder provides more budget highlights that may affect rural Alberta. To view the complete budget and its supporting documents, please click here.
The AAMDC will provide additional details through member bulletins as they become available.
Enquiries may be directed to:
Gerald Rhodes
Executive Director
780.955.4077
Kim Heyman
Director of Advocacy and Communications
780.955.4079
Backgrounder Attached
BACKGROUNDER: AAMDC Budget 2017-18 Details
PROVINCIAL FINANCES
- Total expenditures will increase by $3.8 billion from the 2016-17 budget to $54.9 billion.
- The provincial government is expected to have a $10.3 billion deficit in the 2017-18 fiscal year.
- The provincial debt is set to reach $45 billion in this budget and is forecast to hit $71.1 billion by 2019-20.
- Alberta’s total revenue is forecast to be $45 billion in 2017-18, an increase of $3.6 billion, or 8.7% from 2016-17.
- Non-renewable resource revenue in 2017-18 accounts for 8.3% of total revenue, an increase from 3.3% in Budget 2016-17. It is forecast at $3.8 billion which is a 55% increase from 2016-17 when it was $1.3 billion. The province estimates that resource revenue will increase by 33% per year by 2019-20 where it will be $6.6 billion.
- Personal income tax is expected to raise $11.2 billion in revenue in 2017-18, a $282 million decrease from Budget 2016-17. Personal income tax accounts for 25% of total revenues.
- Corporate income tax is forecast at $3.9 billion in 2017-18, $574 million or 17.2% higher than 2016-17, but $1.9 billion or 32% lower than it was in 2014-15.
- Revenue collected through premiums, fees, licenses, and others sources will raise $3.6 billion.
- The carbon levy is estimated to raise $1.03 billion in 2017-18 and $1.3 billion by 2018-19.
- The Education Property Tax Requisition is forecast at $2.4 billion, a $32 million increase (1.3%) from the 2016-17 budget. The Government of Alberta has frozen the education property tax mill rates as opposed to setting the requisition to 32% of the total education system operating expenses which has been the de facto practice for the past several budgets.
ADVANCED EDUCATION
- Budget 2017 provides $6 billion for Advanced Education in 2017-18. Base operating grants for institutions will increase 2% per year.
- Overall capital funding for post-secondary institutions (both expansion/upgrading and maintenance/renewal of post-secondary institutions) increased from $434.6 million in 2016-17 to $446.6 million in 2017-18.
AGRICULTURE AND FORESTRY
- The Ministry of Agriculture and Forestry’s business plan lists several key outcomes including:
- Alberta’s agriculture and forest industries are competitive
- Alberta’s effective agri-food and forest assurance systems inspire confidence
- Alberta’s agriculture and forest industries are environmentally responsible and sustainable
- Alberta has thriving rural communities
- Rural economic development funding has increased by 28% to $53.2 million for 2017-18.
- Agriculture Income Support has decreased by 5% to $122.1 million.
- The 2017-18 budget for Agri-Insurance, Livestock and Hail Insurance was increased slightly to $476 million.
- Funding for agricultural services boards and agricultural societies remains at similar levels as the previous year.
- Wildlife compensation funding has increased by 17% over the previous budget to $6.7 million.
- Wildfire management has increased by 13% over the previous budget to $97.9 million.
- Forest management has decreased by approximately $4 million to $49.9 million in the 2017-18 budget
AGENCIES, BOARDS AND COMMISSIONS
- After a review of agencies, boards and commissions (ABCs) in 2015, Budget 2016-17 announced the amalgamation or dissolution of 26 ABCs with the intention of improving services and ensuring value for taxpayers.
- Budget 2017-18 provides details on the executive compensation framework for 23 designated public agencies that is expected to save nearly $16 million per year.
COMMUNITY SERVICES
- Alberta First Responders Radio Communication System (AFRRCS) has been transferred to Service Alberta and its funding has been set at $17 million which is the same as the previous budget.
- Family and Community Support Services (FCSS) funding remains stable at $101 million.
- The 2017 Community Initiatives Program budget remained steady from the previous year at $24.6 million.
- Funding for the Provincial Library Network has been maintained at $36 million in 2017-18 though an additional $12 million has been allocated to capital for the Regional Library Systems Headquarters, resulting in an overall funding increase for library services of 35%.
- The Policing Assistance to Municipalities Grant (MPAG) was maintained at approximately $85 million. This includes the Municipal Policing Assistance Grant ($55.8 million) and the New Police Officer Program ($30 million).
- Funding for the Alberta Law Enforcement Response Teams (ALERT) has been maintained at $29.1 million for 2017-18.
- Funding for the Community Facility Enhancement Program (CFEP) has remained steady at $38 million.
- The Summer Temporary Employment Program is funded at $10 million – same as Budget 2016-17.
ECONOMIC DEVELOPMENT AND TRADE
- Funding for the Ministry of Economic Development and Trade has increased slightly from $329 million to $354 million.
- Funding for Jobs, Investment and Diversification, a significant flagship program in Budget 2016-17 has been increased slightly from $23 to $25 million.
- Funding for the Northern Alberta Development Council is reduced slightly from $2.44 million to $2.42 million. Overall funding for Economic Development has been reduced from $20 million to $14.1 million.
EDUCATION
- Student Transportation Services funding will see a $6 million increase to $305 million.
- The 2017-18 budget has set $500 million for new school projects over the next four years, as well as an additional $488 million for future school projects starting in 2018-19.
ENERGY
- Alberta Energy’s business plan identifies several outcomes of interest to AAMDC members:
- Albertans benefit economically from responsible energy and mineral development and access to global markets
- Effective stewardship and regulation of Alberta’s energy and mineral resources
- Albertans benefit from a stable, reliable electricity system that protects consumers, attracts investment, and has improved environmental performance
- Royalties for bitumen are expected to bring in $2.5 billion in Budget 2017-18, a $1.3 billion increase from the forecasted budget in 2016-17.
- Orphan Well Abandonment program funding remains steady from the previous year at $30.5 million.
- ‘Biofuels Initiatives’ under the Department of Energy has been zero-funded in this budget year for the second year but remains a line item on the budget. In Budget 2015-16, this program received $70.5 million.
- Provincial funding of carbon capture and storage initiatives has increased slightly to $213 million from $200 million in 2016-17; however, the forecasted amounts (funds spent) in 2016-17 was only $29 million.
- Funding for the Utilities Consumer Advocate remains steady at $9.1 million.
- The Coal Phase-Out Agreements are anticipated to cost $32 million in Budget 2017-18.
ENVIRONMENT & PARKS
- In Budget 2017-18, $85 million has been allocated for parks including funding to enhance the protection of the Castle Special Management area.
- As the development of regional plans under the Land-use Framework continue, the budget for the Land Use Secretariat has remains steady at $10.3 million.
- Funding for wildlife management is $22.4 million in Budget 2017-18, an increase of 118% over the previous budget.
- Alberta’s Climate Leadership Plan continues to be implemented with the following key aspects:
- Phasing out pollution from coal‑generated electricity by 2030;
- Renewable energy accounting for 30% of generation by 2030;
- Reducing emissions from the oil and gas sector;
- Creating Energy Efficiency Alberta to deliver cost saving programs; and
- Implementing an economy‑wide price on carbon.
- Within Alberta Environment and Parks, the implementation of the Climate Leadership Plan is budgeted at $454.8 million for 2017-18, with an estimated $185 million in revenues directed back to Alberta Environment and Parks from the carbon levy.
- The Government of Alberta’s Environment and Parks business plan identifies that work on flood hazard mapping will continue in 2017-18, though it is zero funded in the provincial budget estimates.
HEALTH & SENIORS
- The Alberta Health budget remains the largest single budget item, at $22.4 billion (combined capital and operating).
- There is $14.7 billion budgeted for Alberta Health Services operations in 2017-18.
- There is a total of $5.2 billion budgeted in 2017-18 for various compensation and development programs for almost 9,700 physicians and 1,650 medical residents. This is an increase of $400 million from last year’s budget.
- The Ministry of Seniors and Housing has been budgeted $687 million in 2017-18. This includes $365 million for the Alberta Seniors Benefit which supports low income seniors.
- This budget also provides $262 million for programs delivered by the Alberta Social Housing Corporation, with $100 million for seniors housing and $67 million for the rental assistance program.
- The Seniors Property Tax Deferral Program budget has increased from $5.8 million in the 2016-17 budget to $7.3 million in the 2017-18 budget.
- At the fall AAMDC convention, a commitment was made by the Government of Alberta that the Rural Physician Action Plan would continue to be funded, though specific budgeted amounts are not identified in the budget documents.
- Alberta Primary Care Networks have received an additional $11 million raising their budget to $244 million.
- The province has allocated $400 million over four years towards the planning and implementation of a new hospital in Edmonton, starting in 2018-19. An additional $131 million will build a new continuing care facility in Calgary.
INDIGENOUS RELATIONS
- The Aboriginal Consultation Office has received a budget of $5.5 million – a minor decrease from 2016-17.
- This budget provides $129 million for the First Nations Development Fund, a $3 million increase, and $23.5 million for First Nations and Métis Relations.
- Alberta Transportation will be administering a new United Nations Declaration on the Rights of Indigenous People (UNDRIP) – Access to Regional Drinking Water Systems Fund at a level of $25 million in 2017-18.
- Indigenous Relations has included several strategic initiatives aimed at increasing collaboration between Indigenous organizations and other governments, including municipalities, in areas such as economic development and improving socio-economic outcomes for Indigenous peoples.
MUNICIPAL AFFAIRS
- The business plan for Alberta Municipal Affairs contains four key outcomes:
- Albertans live in viable municipalities and communities with responsible, collaborative and accountable local governments
- A stronger system of standards ensuring quality infrastructure so that Albertans are safe in their homes and communities
- Albertans are better prepared for disasters and emergencies
- Albertans and municipalities receive fair, timely and well-reasoned decisions on matters before the ministry’s quasi-judicial boards.
- The Municipal Sustainability Initiative (MSI) is funded at $1.211 billion for the 2016-17 budget. The MSI is also expected to be funded at similar levels for the next four years even though the MSI program has technically expired.
- The MSI capital component is maintained at $846 million for the 2017-18 budget year.
- The MSI operating component is maintained at $30 million for the 2017-18 budget year.
- The Basic Municipal Transportation Grant is funded at $335 million, a reduction of $24 million from the previous year.
- In total, $235 million has been set aside for disaster and emergency assistance of which $200 million is unallocated.
- To transition towards the centralization of industrial assessment, Budget 2017-18 allocated $3 million which will be handled within Alberta Municipal Affairs.
- Alberta Community Partnership funding has been reduced to $18.5 million – down from $20 million in Budget 2016-17 and $40 million in Budget 2015-16.
- Grants in Place of Taxes (GIPOT) have been allocated $59 million in this budget – a $3 million increase from the previous budget.
- The Education Property Tax Requisition is forecast at $2.4 billion, a $32 million increase (1.3%) from the 2016-17 budget. The Government of Alberta has frozen the education property tax mill rates as opposed to setting the requisition to 32% of the total education system operating expenses which has been the de facto practice for the past several budgets.
- To assist with the recovery in the RM of Wood Buffalo following last year’s wildfires, $2.4 million has been budgeted to Alberta Municipal Affairs. Other funding, however, is likely allocated to several different ministries for additional assistance.
- The Alberta Emergency Management Agency is funded at the same levels as 2016-17 at $34.4 million.
STATUS OF WOMEN
- Status of Women has budgeted a total of $7.4 million towards gender equality and advancement and gender policy, strategy, and innovation. This is a slight decrease from last year’s budget. One performance indicator for the effectiveness of Status of Women’s initiatives is the percentage of candidates running for municipal office who are women.
TRANSPORTATION
- The Strategic Transportation Infrastructure Fund has received $35 million for 2017-18, with a combined $65 million targeted over the following two budgets.
- A portion of Water for Life and GreenTRIP funding has been allocated towards the Government of Alberta’s portion of federal cost-sharing requirements for the Public Transit Infrastructure Fund and the Clean Water Wastewater Fund.
- Federal Gas Tax funding is at a level of $222 million for 2017-18.
- Funding for municipal water infrastructure programs, which includes Water for Life, the Alberta Municipal Water-Wastewater Program (AMWWP), and the new United Nations Declaration on the Rights of Indigenous People (UNDRIP) – Access to Regional Drinking Water Systems Fund remains steady with a funding level of $130 million in the 2017-18 budget. Water for Life has received $55 million in funding, the AMWWP has received $50 million, and UNDRIP – Access to Regional Drinking Water Systems has received $25 million.
- GreenTRIP funding has increased by $352 million, to a level of $477 million in 2017-18. Funding is anticipated to be reduced in upcoming budget years, down to $10 million in 2020-21.
- $254 million is budgeted for provincial highway maintenance operations, a $13 million decrease from the previous budget year,
- Alberta Transportation has introduced the Alberta Community Transit Fund, and funded it at a level of $40 million for 2017-18. The AAMDC will share program details with members as they become available.
- Alberta Transportation’s business plan identifies several priority initiatives that are relevant to AAMDC members, including the development of multi-modal transportation systems in rural areas, strategies, collaboration with municipalities to create and implement a transparent asset management plan to for Alberta’s transportation network, and the continued enhancement of the TRAVIS MJ automated permitting system, among other initiatives.