INNISFAIL – The Town of Innisfail is seeing a 43 per cent decrease in provincial government infrastructure funding since 2011, and the province’s allocation for 2024 will leave Innisfail with a $100,000 budget shortfall, says mayor Jean Barclay.
The mayor responded strongly and pointedly after a presentation by Todd Becker, the chief administrative officer for the Town of Innisfail, who officially and publicly presented council on Jan. 8 with the news on how much the town is receiving for 2024 from the provincial government’s new Local Government Fiscal Framework (LGFF) program.
“And when we add inflation to that component, a 2.33 per cent annualized inflation rate, it's a 43 per cent decrease,” Barclay told council, who noted the base MSI rate for Innisfail in 2011 was $1.466 million. “We should be receiving around $1.966 million, but instead we're receiving about $1.1 million.”
She later told the Albertan the $1.1 million LGFF allocation for this year will also have a big impact on the 2024 municipal budget that was approved last month – a shortfall of about $100,000, which is equivalent to a one per cent tax increase.
“That will need to be addressed at some point in time,” Barclay told council. “I think it's eye-opening. When you add an inflation component to the 2011 number it shows you how much the community is being underfunded by another level of government, and how our costs have risen.
“I think it's important that all residents realize that shortfall.”
The LGFF is now replacing the Municipal Sustainability Initiative (MSI) program, which was launched in 2007 and continued until 2023.
The current fiscal year brings the inaugural unveiling of annual LGFF capital and operating funding.
In his presentation Becker referred council to a letter in the agenda package from Ric McIver, minister of Alberta Municipal Affairs, who stated the government was “committed to providing predictable, long-term infrastructure funding for all communities.
“While there are some changes to the LGFF capital component when compared to the MSI, we feel strongly these changes will improve the program for local governments and Alberta taxpayers alike,” said McIver in his Dec. 15 letter to chief elected officials.
Becker told council his research showed that LGFF funding for Calgary and Edmonton this year is allocated through a formula based on population (48%), education tax requisitions (48%), and kilometers of roads (4%).
He said the remaining Alberta municipalities receive funding through a formula based on population (65%), tangible capital assets (15%), amortization of tangible capital assets (10%), and kilometers of local roads (10%).
“There is a top-up base funding for municipalities less than 10,000 in population that have limited local assessment base and is distributed to municipalities based on equalized assessment,” said Becker. “It is unclear on how the government defines a municipality having a limited local assessment base.”
With those formulas in mind council heard the 2024 LGFF capital allocation for Innisfail is $1,109,729 and $1,265,548 in 2025.
Council was reminded the 2023 MSI capital allocation was $847,106.
Becker said the 2024 LGFF operating funding allocation is $130,080 which is the same as the 2023 MSI allocation.
Barclay reminded members of council that Alberta Municipalities (ABmunis) hosting a webinar town hall meeting on Jan. 18 to discuss the provincial government’s LGFF capital allocation formula.
