INNISFAIL - The provincial government is loosening the purse strings on infrastructure monies for municipalities and Innisfail is cautiously pleased.
On Aug. 15 Town of Innisfail officials received a letter from the provincial ministry of municipal affairs advising them the province will be releasing $597 million of Municipal Sustainability Initiative (MSI) funds for 2019-2020 to Alberta municipalities for infrastructure improvements. Out of that the town was expecting $1.9 million but will receive just over $1 million now, with at least most of the remainder coming once the provincial budget is passed this fall.
The letter from the province also said essential federal monies for infrastructure improvements under the Federal Gas Tax Fund program will also be released once those funds have been handed over by the federal government to the provinces. The town was originally looking to receive just over $432,000 from the federal program but a subsequent announcement said program grants would be doubled, with Innisfail getting $865,000.
Following last spring's election victory the new UCP government announced it would not be tabling its first budget until the fall, a move designed to allow for more informed financial planning. In the meantime, government operations would be funded through special warrants while an appointed panel would look into the state of provincial finances. Since then the UCP government has not released MSI funds to municipalities for the 2019-2010 fiscal year, and has implemented provincial funding holdbacks, notably for policing and libraries, until after the fall budget. Last week's funding announcement did not address full police and library funding. To date municipalities have received only 50 per cent funding in both areas to cover operational expenses for 2019-2020.
The provincial government's decision on Aug. 15 to finally issue MSI grant money follows increasing frustration and worry from municipalities across the province, many of them running out of money to pay for ongoing operations.
"It has been tough on them, so yes it is good news that is for sure," said Mayor Jim Romane of the Aug. 15 announcement.
Town of Innisfail staff and council members were also becoming frustrated with the UCP grant delays, with council agreeing at its Aug. 12 regular meeting to write to the province about its concern that Federal Gas Tax Fund monies had not yet been released for the 2019-2020 fiscal year. At the same meeting Todd Becker, the town's CAO, said "caution" had been emphasized to all departments regarding the operational budget demands and the possibility of readjustments following the fall provincial budget.
Becker was off on holidays last week and not immediately available for comment on the Aug. 15 development.
"I think the only reason that it has changed is because there has been so much pressure from the AUMA (Alberta Urban Municipalities Association) and communities," said Coun. Jean Barclay. "Innisfail is very lucky because we have very little debt and healthy reserves but certainly there has been communities that have been hugely impacted by not getting this funding."
Heather Whymark, the town's director of corporate services, emphasized that up to now no provincial municipality had yet received any MSI monies, adding the province's movement last week was just a portion of what Innisfail was expecting in MSI funding and won't be the full amount until the government's full budget is completed this fall.
"They are only giving us interim allocations at this point in time. The rest will be released upon budget. It looks like about half. We are not going to get the $1.9 (million). It looks like we are going to get about a million, 90," she said, adding no specific timelines were given. "Usually when this (announcement) comes out you usually see it coming through fairly quickly."
However, Whymark said the news should give Innisfailians a sigh of relief as it will mean town staff and council can prepare for the upcoming budget deliberations with a modicum of confidence.
"It was a little scary going into budget season on what you used to have to budget previously not being on the table. At least that is there and we can go forward," said Whymark, adding there are many municipalities who are in a much more fragile state of affairs than Innisfail. "Many municipalities need the MSI to operate. They put a lot of municipalities in rough shape because they need that to continue on.
"I imagine there has been a lot of letters already going from other municipalities that really needed those funds to operate, so that is why I am guessing they released it," said Whymark, noting the Town of Innisfail did not move off its budget as it's in the enviable position of having healthy reserves and doesn't solely budget based on grant funding.
However, she added the provincial fall budget will put a sharp focus on what 2020 will look like as far as provincial funding support goes. Whymark added the CAO's caution at the Aug. 12 council meeting is still on the table.
"I will not release that caution because we are not getting full funding yet. They are giving a little bit interim to appease because I am sure they are getting calls left and right and backwards and forward," said Whymark. "Until I see fully what they are going to release for 2020 caution will remain at the town as far as our spending."
