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MSI/GTF update from Minister of Municipal Affairs

August 15, 2019

Dear AUMA members,

You should have received a letter from the Minister of Municipal Affairs regarding your interim Municipal Sustainability Initiative (MSI) and Federal Gas Tax Fund (GTF) allocations for 2019. AUMA was notified by the Minister’s office last week that the allocations were forthcoming, and that MSI would be affected.

MSI

We are pleased to see that the full $30 million of MSI Operating is being made available now and that the reporting process for MSI Operating is being streamlined further. Budget 2018 forecasted that MSI Capital would be $294 million in 2019 and the province is making 89% or $260 million available as an interim amount. We will continue to work with the department in advance of the fall budget to attain the full commitment of MSI Capital and the Basic Municipal Transportation Grant (remaining 11%) for our members. The timing of the spring election and resulting delay in MSI funding is an example of why AUMA is striving for a new predictable funding framework so that local infrastructure projects are not stalled during the summer construction season. We look forward to sharing updates on those discussions in the future. AUMA has been clear in communicating that provincial funding for communities is crucial for maintaining the infrastructure that Albertans rely on daily. It is central to our quality of life and enhancing the Alberta Advantage.

Members may note that the province’s stated 2018 and 2019 MSI Capital funding amounts are lower than past years. This was expected as the province had advanced on their books $800 million of future MSI Capital in their 2017-18 fiscal year. The advance allowed the province to reduce MSI Capital by $400 million in each of the 2018-19 and 2019-20 fiscal years, while still maintaining a stable level of MSI to municipalities. So, in addition to the grant amounts stated above, if your municipality has not yet accessed this re-profiled funding, you will also be able to apply and receive those MSI funds. More information about the re-profiled 2018 and 2019 MSI can be found in AUMA’s 2018 provincial budget analysis report.  

GTF

We are also pleased with the province’s approach to the 2019 GTF. When the federal government announced that it was providing a one-time top-up of the 2019 GTF, we raised concerns about how Alberta’s smaller communities would not equitably benefit from the increase in 2019 GTF due to the mechanics of Alberta’s GTF allocation formula. We are pleased that Municipal Affairs acknowledged the issue and calculated the top-up amount separately to ensure that all municipalities receive an equitable share of the 2019 GTF.