RMA has been working hard to advocate on behalf of members, bringing the rural municipal perspective to provincial decision makers
The past few months have been busy as RMA continues to engage with provincial decision makers post-election. A significant focus has been to demonstrate the importance of rural Alberta as a contributor to the provincial economy, and to ensure that RMA is the collective voice to represent those interests.
The new provincial government campaigned on their platform, Getting Alberta Back to Work, which includes three priorities: getting Albertans back to work, making life better for Albertans, and standing up for Alberta. The government focused their first session on fulfilling platform promises identified, which included the introduction of 13 bills. Building relationships with provincial decision makers has been a priority for RMA during this time, recognizing that many of these bills were drafted prior to the session starting.
Since cabinet was appointed on April 30, the RMA has actively engaged with the Government of Alberta and other MLAs, as well as priority stakeholders that have an interest in our election advocacy priorities. This includes:
Communicating with provincially elected officials that RMA is the voice for rural Alberta and working as a trusted partner to provide input into potential policy changes
Analyzing the UCP Platform, and providing formal correspondence to the Government of Alberta identifying needed areas for clarification and RMA involvement
Meeting with rural MLAs to demonstrate the importance of rural sustainability, the need for open consultation, and the upcoming anticipated discussions regarding predictable municipal grant funding
Meeting with Chiefs of Staff to foster relationships and build connections to support engagement
Attending the Speech from the Throne and connecting with Premier Kenney
Working with the Explorers and Producers Association of Canada to better understand the challenges facing shallow gas producers
Working with the Minister of Municipal Affairs, Associate Minister of Natural Gas, and senior staff to find a temporary solution regarding the property taxation challenges identified by shallow gas producers
Communicating with the Minister of Transportation on concerns identified regarding potential changes to road permitting and service rigs on rural roads
Engaging with the Associate Minister of Red Tape Reduction to provide preliminary input on challenges related to Water Act and Wetland Policy approvals
Providing formal correspondence to the Government of Alberta regarding the need for updated flood mapping and the outstanding completion of the outstanding Floodway Development Regulation
Various media interviews regarding unpaid property taxes from oil and gas operations, the impact of shallow gas property tax reductions and responsible resource development
In the coming weeks, we have meetings scheduled with various cabinet ministers and will continue to focus efforts on building connections with the Rural Caucus, once it is formed. Our goal continues to focus on building positive relationships and carrying forward consistent advocacy messages that reflect rural municipal priorities.
RMA has resources available to support local advocacy on rural municipal issues
Since the election this spring, RMA has been actively engaging with government and all MLAs to demonstrate the importance of rural Alberta. Our goal continues to be focusing on ensuring provincial decision-makers understand that rural Alberta is an integral piece of Alberta’s economic, social, environmental, and cultural future. We have had the opportunity to meet with rural MLAs to discuss issues of importance to our members and have also met with some key cabinet ministers, with more Minister meetings being scheduled throughout the summer.
As a member-driven organization, our members play an important role in our advocacy efforts. With the legislative session likely wrapping up in July, this is a great opportunity for members to engage local MLAs and bring forward RMA messages to demonstrate a clear and concise rural perspective. The RMA has developed several resources to help members in this capacity, include the following five priority issues we have focused on during our election campaign:
Each of these issues has a video available that can be shared with local networks on social media to advance the rural perspective. The RMA has also developed several position statements on issues ranging from agriculture to policing and rural crime that we encourage members to utilize as they are connecting with MLAs.
As we like to say, Rural Alberta is where it all starts and carrying these messages forward consistently through local advocacy strengthens the rural voice.
AER and Farmers Advocate have tools available to landowners if oil and gas companies do not fulfill their access agreements
Many rural Alberta landowners have benefited economically from surface access agreements with oil and gas companies. However, there are situations where individual energy companies have approached landowners in an attempt to not pay the full amount agreed to in their surface access agreement. Landowners can register their private surface agreement (PSA) with the Alberta Energy Regulator (AER). Once a PSA is registered with the AER, the AER can help enforce the terms of the PSA, including non-payment for surface access.
An additional resource for Alberta farmers is the Farmers Advocate Office(FAO). A recent FAO release notes that some farmers are being approached by oil and gas companies with infrastructure on their land offering a reduced access payment. Farmers with concerns about this activity are encouraged to contact FAO by phone at 310-FARM (3276) or email@example.com.
For more information on how to register a PSA with the AER, click click here.
Municipalities may offer impacted companies a reduction of up to 35% on well and pipeline taxation, to be reimbursed by an equivalent reduction in the education property tax requisition amount
On July 2, 2019, the Government of Alberta announced a plan to offer tax relief to struggling shallow gas companies operating in rural municipalities across the province. The program will allow the municipalities to offer impacted shallow gas companies a reduction of up to 35% in their 2019 property tax bill on wells and pipelines. Municipalities will then be reimbursed by the Government of Alberta for any reductions they provide to shallow gas companies through the forgiveness of an equivalent amount of the education tax requisition that the municipality owes to the province. The Government of Alberta expects to provide more than $23 million in education property tax credits back to municipalities through this initiative.
For this one-time solution, the Government of Alberta emphasizes that any reductions to the required amount of education property taxes that municipalities would normally collect will be supplemented from general revenues.
How will the process work?
The Government of Alberta will work with impacted municipalities to implement the following process:
Distribute a list of qualifying shallow gas pipelines to impacted municipalities and companies
Help companies report natural gas pipelines related to the wells
Work with municipalities to develop process by which municipalities will forgive taxes and report amount forgiven to Government of Alberta
Reduce the education property tax requisition by equivalent amount
Your municipality will be contacted by Alberta Municipal Affairs if you host a qualifying company. If your municipality is not contacted by Municipal Affairs, you do not host any companies eligible for tax relief.
Why the shallow gas industry?
While companies across many sectors periodically struggle for a variety of reasons, the Government of Alberta has identified specific concerns with the fairness of how shallow gas wells are assessed. There is currently a review being undertaken to update assessment values for wells and pipelines which is expected to be complete later this year, with changes implemented for the 2020 tax year. This relief is intended to provide temporary support to shallow gas companies prior to the updating of assessment amounts.
The shallow gas industry has indicated that many companies are at high risk for company failure or insolvency which may lead to job losses, abandonment of reclamation liabilities, and lost municipal tax revenue.
More details on this initiative is available here.
RMH worked with 24 rural communities in their pilot year, and is now accepting applications for year two. To view the application form, click here. In many cases the Community Animator is the Family and Community Support Services (FCSS) Coordinator, although any community member can receive training to be the Community Animator. To get in touch with your local FCSS coordinator, click here.
Nisku, AB, July 2, 2019 – The Rural Municipalities of Alberta (RMA) appreciates the Government of Alberta’s decision to enable short-term relief to the shallow gas industry through the forgiveness of a portion of municipal property taxes on specific wells and pipelines identified by the Government of Alberta. This will allow municipalities to reduce the overall amount of property taxes to be paid by impacted companies. This action is the result of a crisis being faced by Alberta’s shallow gas industry due to a combination of historically low natural gas prices and high operating costs.
The shallow gas industry is critical to Alberta’s economy as well as to the sustainability of many rural communities across the province. Shallow gas companies support jobs and contribute to municipal infrastructure and services through the payment of property taxes. The Government of Alberta’s decision allows municipalities to reduce overall property taxes for these companies, produces a mutually beneficial short-term solution for impacted companies and rural municipalities; it allows companies a temporary reduction in operating expenses, while also ensuring that municipalities will still receive a portion of property taxes from impacted companies in order to adequately provide municipal services.
“Shallow gas companies are in a tough situation, and it’s been essential to work with the Government of Alberta and industry representatives to come up with short-term solutions to support the industry,” said Al Kemmere, President of the Rural Municipalities of Alberta. “We recognize that municipal and education property taxes are not the core cause of the industry’s struggle, but are likely the only area in which short-term relief can be found, so we’re pleased with the Government of Alberta’s announcement today, as it helps the shallow gas industry without unfairly penalizing rural municipalities. In the long term, property taxes should not be seen as a tool for relief.”
Education property taxes are collected by municipalities across the province on all taxable properties on behalf of the Government of Alberta. Although they are collected by municipalities in tandem with municipal property taxes, they are transferred directly to the Alberta School Foundation Fund (ASFF) to support operational expenses for Alberta’s schools. For this one-time solution, any reductions to the required amount of education property taxes that municipalities would normally collect will be supplemented to the ASFF from general revenues. In this regard, the Government of Alberta is utilizing one of the few short-term options available while ensuring education funding remains whole.
“Rural municipalities have a strong partnership with the oil and gas industry, including shallow gas companies. However, reducing or forgiving property taxes is not a realistic short-term option for municipalities. Allowing municipalities to forgive a portion of property taxes while being supported by the Government of Alberta through reduced education tax requirements provides industry with badly-needed financial relief while ensuring that rural municipalities can provide the services and infrastructure that residents and businesses rely on,” said Kemmere.
In the long-term, RMA supports further government and industry action to stabilize the shallow gas industry in Alberta. Potential solutions include revisiting how taxes and fees on shallow gas wells are calculated to ensure they are fair, increasing pipeline capacity and market access for natural gas, and investigating possible reduction of natural gas production until world prices recover.
“At the end of the day, RMA’s vision is for strong, vibrant, and resilient rural communities. As RMA members cover approximately 85% of the province, we host most of Alberta’s oil and gas activity, including shallow gas,” Kemmere said. “A strong oil and gas industry goes hand-in-hand with sustainable rural communities, so we’re pleased to support the Government of Alberta’s short-term solution to support the shallow gas industry, and we look forward to being part of discussions as to how shallow gas companies can thrive in rural Alberta for many years to come.”
The Rural Municipalities of Alberta (RMA) is an independent association comprising Alberta’s 69 counties and municipal districts. Since 1909, the RMA has helped rural municipalities achieve strong, effective local government. The RMA provides Advocacy and Business Services (including RMA Trade, RMA Fuel and RMA Insurance).