The Government of Alberta has released Budget 2020: A plan for jobs and the economy
for the 2020-21 fiscal year and 2020-23 Fiscal Plan
The 2020-21 budget focuses on four key Government of Alberta priorities:
- Getting service to people who need them
- Getting Alberta back to work
- Getting spending under control
- Getting a fair deal
For a full breakdown of the budget and estimates, visit the Government of Alberta’s Budget 2020 webpage.
The following are details of the 2020-21 budget that will be important for RMA members:
- The Government of Alberta is expected to have an $6.8 billion deficit in the 2020-21 fiscal year, a reduction from the previous year, in which a deficit of $7.5 billion has been forecast. The deficit is targeted to decrease further to $2.7 billion in 2021-22 and become a $0.7 billion surplus in 2022-23.
- The 2020-21 Municipal Sustainability Initiative (MSI) funding components are as follows:
- The MSI capital component is funded at $963 million (which includes Basic Municipal Transportation Grant [BMTG] funding).
- The MSI operating component is funded at $30 million.
- MSI funding is projected to decrease to a total of $927 million in 2021-22, before the program is replaced with the Local Government Fiscal Framework in 2022-23. This reduction is consistent with the plan presented in the 2019 provincial budget.
- The Strategic Transportation Infrastructure Program (STIP) has received $15 million, a decrease of $7.5 million from 2019-2020.
- Orphan Well Abandonment program funding has increased from $55.8 million to $69 million, due to a combination of an increased number of orphan wells and more efficient administration of the program.
- The Education Property Tax Requisition is forecast at $2.6 billion, an increase of $102 million from the 2019-20 requisition level. This significant increase in the requisition will further limit the ability of municipalities to increase taxes to address other cost pressure introduced by the province, since police costing and upcoming reduction in grant funding through the new Local Government Fiscal Framework.
- The residential/farm rate has increased from $2.56 to $2.64 per $1,000 of equalized assessment, and the non-residential rate has increased from $3.76 to $3.88 per $1,000 of equalized assessment.
- Approximately $10 million will be deducted from education property tax revenue in 2020-21 and 2021-22 to support the continuation of the Provincial Education Requisition Program (PERC).
- Funding for provincial contract policing has increased from approximately $263 million in in 2019-20 to approximately $280 million in 2020-21. This is likely due to the implementation of the new police costing model in which municipalities are required to contribute 10% of frontline policing costs under the Provincial Police Services Agreement in the 2020-21 provincial fiscal year. According to the Government of Alberta, the model will collect $23.5 million in costs from municipalities in 2020-21, not including reductions after the application of various modifiers and subsidies. Additionally, the $280 million amount above also includes police oversight, so determining the exact impact of the new police costing model on the budget amount is not possible with the information currently available.
Along with the release of Budget 2020, the Government of Alberta also tabled Bill 4: Fiscal Planning and Transparency (Fixed Budget Period) Amendment Act, 2020.
Bill 4 identifies that a provincial budget must be released each year in the month of February.
The attached backgrounder
provides more budget highlights that may affect rural Alberta. The RMA will provide additional details through member bulletins as they become available. To view the complete budget and its supporting documents, please click here
Enquiries may be directed to:
Director of External Relations and Advocacy