+ RMA Rural Municipalities
of Alberta

Resolution ER1-15F

Restore Grants-in-Lieu of Taxes for Public Housing

November 26, 2015
Expiry Date:
June 15, 2018
Active Status:
County of St. Paul
Municipal Governance and Finances
Vote Results:

WHEREAS the Provincial Government’s budget tabled in October 2015 eliminated grants in-lieu-of taxes for seniors’ apartments and family housing units operated by public housing management bodies;

WHEREAS municipalities have been utilizing these grants in-lieu-of taxes to help offset the cost of services that are provided to all citizens and property in the municipality including seniors’ apartments and family housing units;

WHEREAS this represents a loss of $16 million in municipal revenues that municipalities will have to make up by increasing property taxes from an already strained property tax system just to maintain current service levels;

WHEREAS the provincial government recognized the need for a lodge renewal program and proposed to reinvest these funds to the renewal program, effectively transferring additional burden onto municipalities;

WHEREAS section 362 of the Municipal Government Act (MGA) exempts any interest held by the Crown in right of Alberta as exempt from property taxation;

WHEREAS section 20 of the Alberta Housing Act (AHA) states that the Alberta Social Housing Corporation (ASHC) is an agent of the Crown in right of Alberta;

WHEREAS section 27(1) of the AHA provides that the Corporation may each year pay to any municipality within which any of the ASHC’s real property is situated a grant not exceeding the amount that would be recoverable by the municipality if the property were subject to the property taxes of the municipality for that year;

WHEREAS section 27(2) of the AHA states that no municipality is entitled as of right to a grant under this section; and

WHEREAS the majority of revenue that is raised by a municipality to cover the cost of its operations is from property taxes and any reduction in revenues must be borne by the other property tax payers of the municipality;

Operative Clause:

THEREFORE BE IT RESOLVED THAT the Alberta Association of Municipal Districts and Counties urges the provincial government to reinstate grants in-lieu-of taxes for housing units operated by public housing management bodies; and

FURTHER BE IT RESOLVED THAT the Alberta Association of Municipal Districts and Counties call upon the provincial government to revise the Alberta Housing Act by amending section 27(1) by taking the word “may” out of the clause and replacing it with “shall” and by deleting section 27(2).

Member Background:

The Government of Alberta as part of the Budget 2015, has eliminated municipal grants for property taxes paid to Housing Management Bodies to cover property tax assessment.

Municipalities across Alberta are deeply concerned that the provincial government is reneging on its obligation to pay a grant in lieu of tax on government owned and supported social housing. Affordable housing is an issue that Alberta municipalities have long championed, as it is essential to building vibrant, sustainable, inclusive communities.

This represents a downloading of approximately $16 million in costs onto the shoulders of municipalities who are already stressed to address infrastructure deficits as a result of shortfalls in federal and provincial funding. This decision means municipalities will have to reduce critical municipal services or increase the taxes for other property owners in order to make up the shortfall.

The funding reductions impact nearly 23,000 units owned by the Alberta Social Housing Corporation and over 2,200 units owned by municipalities. While the province is dealing with reduced revenues, it remains unfair and shortsighted for the province to cut funding for something so vital to our communities.

RMA Background:

The AAMDC has no active resolutions directly related to this issue.

Provincial Ministries:
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