Yesterday, AUMA’s municipal association colleagues, the Rural Municipalities of Alberta (RMA), announced that approximately $245 million in property taxes owed to rural municipalities by oil and gas companies have gone unpaid.
Even more troubling, RMA’s data indicates some of these oil and gas companies are continuing to operate while not paying their fair share of taxes. Municipalities currently have no other recourse to recoup these funds except through tax increases or service cuts to their remaining residents and businesses, who are essentially subsidizing the significant municipal infrastructure and services these delinquent companies consume.
AUMA supports financial health of all municipalities
Financially healthy municipalities are a critical component to a resilient Alberta, one that can recover and share in brighter times ahead. AUMA supports all Alberta municipalities, including our rural neighbours, who are grappling with this significant property taxation issue. Industry is an important and significant user of municipal infrastructure. These are services consumed by the industry and it is only right that they pay their fair share for them.
We support RMA’s calls to the provincial government, which include:
- amending the process through which the Alberta Energy Regulator approves the acquisition and transfer of energy licences and approvals; and
- no longer requiring municipalities to provide education property tax funds to the province on properties for which taxes are uncollectible (which is essentially penalizing municipalities again, as they must still forward a portion of these uncollected taxes).
AUMA calls on delinquent oil and gas companies and industry associations to do better
AUMA understands that the vast majority of oil and gas companies pay their municipal taxes, but the delinquent companies must pay their property taxes. We also call on oil and gas industry associations to encourage their members to do so. The oil and gas industry and their associations could start by supporting the RMA’s calls to the provincial government.
Industry associations must know that other jurisdictions in our country are watching this situation, and refusing to pay property taxes to municipalities negatively impacts the oil and gas industry’s reputation and the willingness of the public to support major investments in future projects.
For media inquiries, contact:
Communications Manager, AUMA