The Government of Alberta has released Budget 2025 and the 2025 – 2028 Fiscal Plan.
RMA President Kara Westerlund’s initial reaction to Budget 2025 is as follows:
Alberta is facing fiscal uncertainty today and in the coming years. Now is the time for the Government of Alberta to be bold in building the infrastructure to support growth and self-sufficiency in emerging rural sectors. In unpredictable times, we need stable and Alberta-first investment. A meaningful effort to partner with rural municipalities to reduce the current $17 billion rural municipal infrastructure deficit would not only lead to short-term growth and job creation, but also to a more resilient and capable provincial infrastructure network that could better support new technologies and investment in emerging rural sectors such as renewable energy, value-added agriculture, and data centres. Budget 2025 is a missed opportunity to grow rural Alberta and increases the pressure that rural municipalities face to meet an ever-expanding list of responsibilities.
RMA is disappointed that funding for the Strategic Transportation Infrastructure Program is unchanged, as the condition of rural municipal roads and bridges continues to decline. While an increase to the Local Government Fiscal Framework is positive, RMA will continue to call for a more focused provincial approach on rural municipal infrastructure with a direct role in driving industrial development. RMA is also concerned with the reduction in municipal water and wastewater funding, which is a core aspect of maintaining quality of life and accommodating growth across Alberta. This, combined with an increase in Education Property Tax rates, will reduce municipal revenues from grants and from property taxes. There is no question that all sectors in the province must respond to global uncertainty, but Budget 2025 has overlooked the role of rural municipalities as drivers of and partners in economic development.
For a full breakdown of the budget and estimates, visit the Government of Alberta’s Budget 2025 webpage.
The following are details of the 2025 – 2026 budget that will be important for RMA members:
- Alberta’s estimated revenue is $74.1 billion, an increase from last year’s budget of $73.5 billion.
- The Government of Alberta is anticipating a deficit of $5.2 billion due to external factors such as tariffs. However, the fiscal plan includes an intention to return to a balanced budget over the next three years.
- Contingency, disaster, and emergency assistance funding is grouped together within the budget. This includes funding for fighting wildfires, crop insurance, and flood recovery. In 2025 the contingency funding for these elements will be $4 billion, doubling the 2024 budget.
- Funding for the Municipal Water and Wastewater Program decreases significantly. The program was budgeted $86 million in 2023-2024, $66 million in 2024-2025, and $44.7 million in 2025-2026.
- Following a freeze in 2024-25, education property tax rates will increase in 2025-26 from $2.56 to $2.72/$1,000 of equalized assessment for residential/farmland property, and from $3.76 to $4 .00/$1,000 of equalized assessment for non-residential property. This is expected to raise the education property tax requisition from $2.7 billion in 2024-25 to $3.1 billion in 2025-26.
- Funding for the Strategic Transportation Infrastructure Program (STIP) has decreased, although the forecasted three-year funding total is consistent with last year.
- The capital plan invests $164 million over three years in the Water Management Infrastructure Program to repair and upgrade water infrastructure such as canals, dams, spillways, and reservoirs. RMA is disappointed in the significant funding reduction for the Alberta Municipal Water/Wastewater Program.
- The Government of Alberta continues to fund the Drought and Flood Protection Program as expected, with $25 million allocated this year for municipalities and other local authorities to undertake local drought and flood mitigation projects.
- The Provincial Education Requisition Credit (PERC) continues to be funded at $3 million.
- $40.7 million is allocated for wildfire mitigation initiatives, and an additional $2.1 million is available to modernize wildfire applications.
- $820 million is allocated for the Local Government Fiscal Framework (LGFF) capital component, based on alignment to changes in overall provincial revenues.
The backgrounder provides more budget highlights that may affect rural Alberta. The RMA will provide additional details and analysis through member bulletins as they become available. You can view the complete budget and its supporting documents online.
Wyatt Skovron
General Manager of Policy & Advocacy
780.955.4096
wyatt@RMAlberta.com