+ RMA Rural Municipalities
of Alberta

Resolution 11-99F

Education Property Tax

January 1, 1999
Expiry Date:
December 1, 2002
Active Status:
Vote Results:

WHEREAS in 1994 the Province of Alberta assumed full responsibility for funding education and for the education property tax system; AND WHEREAS the education property tax system is truly confounding and is based on factors associated with equalized and live assessments, caps on equalized assessments, regulated and market values, uniform provincial mill rates and live mill rates; AND WHEREAS some citizens on fixed incomes who live on residential and farm properties face large tax increases resulting from increases in market value;AND WHEREAS the current education property tax system has and will continue to result in shifts and increases in education taxes to certain Alberta property owners that are considered neither fair nor understandable to them; AND WHEREAS significant and much needed funding is generated by the Province through the education property tax system;

Operative Clause:

THEREFORE BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties urge the Government of Alberta to: 1. commencing in the Year 2000, cap residential and farmland education property tax requisitions at 1999 levels for each municipality in the province; 2. commence a program for each year thereafter, of education residential and farmland property tax requisition reductions from the previous capped levels, with a view to eliminate this tax over a short period of years as the primary form of tax relief given to Albertans by its provincial government; and3. continue to provide required funds and to offset reduced revenues for primary and secondary education programs, from the general revenues of the Province.

Member Background:

During the past few years, the provincial government has received numerous presentations, lobbies and resolutions relating to the taxation of residential and farmland property for education purposes. The purpose of this resolution is to keep the issue in front of the Alberta Government, and to suggest an alternative. Generally, municipal concerns with the present education tax system are as follows:Confusion:The present education tax system is extremely confusing for the general public. Given the inter-relationships between equalized and live assessment, capped assessments, regulated and market assessment values, and uniform provincial mill rates and live municipal mill rates, there is little wonder the general public is unable to understand the basis of their education tax levy. For example, in 1998, when the province announced that its education taxes were being reduced, the education tax reflected on some municipal tax notices in Alberta actually increased. Such occurrences add to the growing frustration on the part of property owners with respect to property taxes. It also diminishes the credibility of the property tax system in the eyes of the general public.Instability:One of the main complaints many municipalities receive every year concerns the escalation of the education property tax. Generally, the complaint is that although no improvements have occurred on a ratepayers property, that individual has received an increase in their property tax. People on fixed incomes are particularly troubled and are concerned that they may not be able to keep their properties because of rising taxes. Quite simply, property owners are now looking for some certainty that their education taxes will stop rising.Unfairness:Another concern with the present education tax system relates to differing tax amounts that are collected from similar residential properties in Alberta.An Administrative Committee struck by Honourable Iris Evans in 1998 investigated the effect of market value assessment on the levying of education property tax throughout the province. That Committee determined that the use of market value assessment, as the means by which the education tax is levied, is resulting in inequities in terms of the contribution made by property owners in different parts of the province.The Committee found that, consistently, property owners located in strong real estate markets paid considerably more education tax than homeowners in weaker real estate markets on similar housing styles and property types. In certain cases, the tax levy between similar style housing differed by as much as $1,200, and differences of $600-$800 were common.Given that education is funded consistently across the province, it is understandable that these discrepancies have become a major issue with both taxpayers and local officials.The delegate body of the Alberta Association of Municipal Districts and Counties is urged to support this resolution and to continue in its lobby efforts to the provincial government for meaningful change, consistent with this resolution, to the manner in which education is funded in this province. The alternative is that a system that is unfair to the people of Alberta will come.

Provincial Ministries:
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